Correlation Between SentinelOne and Eversource Energy

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

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

Diversification Opportunities for SentinelOne and Eversource Energy

-0.08

Correlation Coefficient

SentinelOne  Eversource Energy

Good diversification

The 3 months correlation between SentinelOne and Eversource is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Eversource Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eversource Energy 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 Eversource Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eversource Energy has no effect on the direction of SentinelOne i.e., SentinelOne and Eversource Energy go up and down completely randomly.

Pair Corralation between SentinelOne and Eversource Energy

Taking into account the 90-day investment horizon SentinelOne is expected to generate 3.91 times less return on investment than Eversource Energy. In addition to that, SentinelOne is 2.0 times more volatile than Eversource Energy. It trades about 0.02 of its total potential returns per unit of risk. Eversource Energy is currently generating about 0.15 per unit of volatility. If you would invest  5,875  in Eversource Energy on April 30, 2025 and sell it today you would earn a total of  762.00  from holding Eversource Energy or generate 12.97% return on investment over 90 days.

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

SentinelOne  vs.  Eversource Energy

SentinelOne

Risk-Adjusted Performance

Insignificant

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.

Eversource Energy

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Eversource Energy are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Eversource Energy unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with SentinelOne and Eversource Energy

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

The idea behind SentinelOne and Eversource Energy 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.