Correlation Between SentinelOne and First Business

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

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

Diversification Opportunities for SentinelOne and First Business

0.29

Correlation Coefficient

SentinelOne  First Business

Modest diversification

The 3 months correlation between SentinelOne and First is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and First Business Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Business Financial 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 First Business. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Business Financial has no effect on the direction of SentinelOne i.e., SentinelOne and First Business go up and down completely randomly.

Pair Corralation between SentinelOne and First Business

Taking into account the 90-day investment horizon SentinelOne is expected to generate 1.84 times less return on investment than First Business. In addition to that, SentinelOne is 1.59 times more volatile than First Business Financial. It trades about 0.04 of its total potential returns per unit of risk. First Business Financial is currently generating about 0.11 per unit of volatility. If you would invest  4,652  in First Business Financial on June 15, 2025 and sell it today you would earn a total of  527.00  from holding First Business Financial or generate 11.33% return on investment over 90 days.

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

SentinelOne  vs.  First Business Financial

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 uncertain basic indicators, SentinelOne may actually be approaching a critical reversion point that can send shares even higher in October 2025.

First Business Financial

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in First Business Financial are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak forward indicators, First Business may actually be approaching a critical reversion point that can send shares even higher in October 2025.

Pair Trading with SentinelOne and First Business

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

The idea behind SentinelOne and First Business Financial 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.