Correlation Between SentinelOne and BASF SE

Can any of the company-specific risk be diversified away by investing in both SentinelOne and BASF SE 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 BASF SE into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between SentinelOne and BASF SE NA, you can compare the effects of market volatilities on SentinelOne and BASF SE 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 BASF SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and BASF SE.

Diversification Opportunities for SentinelOne and BASF SE

-0.18

Correlation Coefficient

SentinelOne  BASF SE

Good diversification

The 3 months correlation between SentinelOne and BASF is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and BASF SE NA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BASF SE NA 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 BASF SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BASF SE NA has no effect on the direction of SentinelOne i.e., SentinelOne and BASF SE go up and down completely randomly.

Pair Corralation between SentinelOne and BASF SE

Taking into account the 90-day investment horizon SentinelOne is expected to under-perform the BASF SE. In addition to that, SentinelOne is 1.38 times more volatile than BASF SE NA. It trades about -0.06 of its total potential returns per unit of risk. BASF SE NA is currently generating about 0.08 per unit of volatility. If you would invest  4,818  in BASF SE NA on May 21, 2025 and sell it today you would earn a total of  449.00  from holding BASF SE NA or generate 9.32% return on investment over 90 days.

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

SentinelOne  vs.  BASF SE NA

SentinelOne

Risk-Adjusted Performance

Weakest

Over the last 90 days SentinelOne has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

BASF SE NA

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in BASF SE NA are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, BASF SE may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with SentinelOne and BASF SE

The main advantage of trading using opposite SentinelOne and BASF SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, BASF SE 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 BASF SE will offset losses from the drop in BASF SE's long position.

The idea behind SentinelOne and BASF SE NA 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.