Correlation Between SentinelOne and AudioCodes

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Can any of the company-specific risk be diversified away by investing in both SentinelOne and AudioCodes 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 SentinelOne and AudioCodes into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and AudioCodes, you can compare the effects of market volatilities on SentinelOne and AudioCodes 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 SentinelOne with a short position of AudioCodes. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and AudioCodes.

Diversification Opportunities for SentinelOne and AudioCodes

-0.13
  Correlation Coefficient

Good diversification

The 3 months correlation between SentinelOne and AudioCodes is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and AudioCodes in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AudioCodes and SentinelOne 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 SentinelOne are associated (or correlated) with AudioCodes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AudioCodes has no effect on the direction of SentinelOne i.e., SentinelOne and AudioCodes go up and down completely randomly.

Pair Corralation between SentinelOne and AudioCodes

Taking into account the 90-day investment horizon SentinelOne is expected to generate 3.03 times less return on investment than AudioCodes. But when comparing it to its historical volatility, SentinelOne is 1.36 times less risky than AudioCodes. It trades about 0.02 of its potential returns per unit of risk. AudioCodes is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  940.00  in AudioCodes on May 1, 2025 and sell it today you would earn a total of  64.00  from holding AudioCodes or generate 6.81% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

SentinelOne  vs.  AudioCodes

 Performance 
       Timeline  
SentinelOne 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in SentinelOne are ranked lower than 1 (%) 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.
AudioCodes 

Risk-Adjusted Performance

Insignificant

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in AudioCodes are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating fundamental indicators, AudioCodes may actually be approaching a critical reversion point that can send shares even higher in August 2025.

SentinelOne and AudioCodes Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with SentinelOne and AudioCodes

The main advantage of trading using opposite SentinelOne and AudioCodes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, AudioCodes 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 AudioCodes will offset losses from the drop in AudioCodes' long position.
The idea behind SentinelOne and AudioCodes 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.

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