Correlation Between SentinelOne and Co Diagnostics

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

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

Diversification Opportunities for SentinelOne and Co Diagnostics

0.1

Correlation Coefficient

SentinelOne  Co Diagnostics

Average diversification

The 3 months correlation between SentinelOne and CODX is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Co Diagnostics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Co Diagnostics 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 Co Diagnostics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Co Diagnostics has no effect on the direction of SentinelOne i.e., SentinelOne and Co Diagnostics go up and down completely randomly.

Pair Corralation between SentinelOne and Co Diagnostics

Taking into account the 90-day investment horizon SentinelOne is expected to under-perform the Co Diagnostics. But the stock apears to be less risky and, when comparing its historical volatility, SentinelOne is 23.68 times less risky than Co Diagnostics. The stock trades about -0.21 of its potential returns per unit of risk. The Co Diagnostics is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  35.00  in Co Diagnostics on August 25, 2025 and sell it today you would earn a total of  0.00  from holding Co Diagnostics or generate 0.0% return on investment over 90 days.

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

SentinelOne  vs.  Co Diagnostics

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 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.

Co Diagnostics

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Co Diagnostics are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady fundamental indicators, Co Diagnostics showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with SentinelOne and Co Diagnostics

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

The idea behind SentinelOne and Co Diagnostics 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.

Check out your portfolio center.

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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.