Correlation Between Dollar Tree and SentinelOne

Can any of the company-specific risk be diversified away by investing in both Dollar Tree and SentinelOne at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Dollar Tree and SentinelOne into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Dollar Tree and SentinelOne, you can compare the effects of market volatilities on Dollar Tree and SentinelOne and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Dollar Tree with a short position of SentinelOne. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dollar Tree and SentinelOne.

Diversification Opportunities for Dollar Tree and SentinelOne

-0.43

Correlation Coefficient

Dollar Tree  SentinelOne

Very good diversification

The 3 months correlation between Dollar and SentinelOne is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Dollar Tree and SentinelOne in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SentinelOne and Dollar Tree is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Dollar Tree are associated (or correlated) with SentinelOne. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SentinelOne has no effect on the direction of Dollar Tree i.e., Dollar Tree and SentinelOne go up and down completely randomly.

Pair Corralation between Dollar Tree and SentinelOne

Given the investment horizon of 90 days Dollar Tree is expected to under-perform the SentinelOne. But the stock apears to be less risky and, when comparing its historical volatility, Dollar Tree is 1.24 times less risky than SentinelOne. The stock trades about -0.1 of its potential returns per unit of risk. The SentinelOne is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  1,722  in SentinelOne on August 5, 2025 and sell it today you would earn a total of  63.00  from holding SentinelOne or generate 3.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Dollar Tree  vs.  SentinelOne

Dollar Tree

Risk-Adjusted Performance

Weakest

Over the last 90 days Dollar Tree has generated negative risk-adjusted returns adding no value to investors with long positions. Even with fragile performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in December 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

SentinelOne

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SentinelOne are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, SentinelOne is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Dollar Tree and SentinelOne

The main advantage of trading using opposite Dollar Tree and SentinelOne positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dollar Tree position performs unexpectedly, SentinelOne can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in SentinelOne will offset losses from the drop in SentinelOne's long position.

The idea behind Dollar Tree and SentinelOne pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.