Correlation Between SentinelOne and Wrapped Bitcoin

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

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

Diversification Opportunities for SentinelOne and Wrapped Bitcoin

0.08

Correlation Coefficient

SentinelOne  Wrapped Bitcoin

Significant diversification

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

Pair Corralation between SentinelOne and Wrapped Bitcoin

Taking into account the 90-day investment horizon SentinelOne is expected to generate 22.1 times less return on investment than Wrapped Bitcoin. In addition to that, SentinelOne is 1.51 times more volatile than Wrapped Bitcoin. It trades about 0.01 of its total potential returns per unit of risk. Wrapped Bitcoin is currently generating about 0.18 per unit of volatility. If you would invest  9,689,599  in Wrapped Bitcoin on May 1, 2025 and sell it today you would earn a total of  2,100,401  from holding Wrapped Bitcoin or generate 21.68% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	96.88%
Values	Daily Returns

SentinelOne  vs.  Wrapped Bitcoin

SentinelOne

Risk-Adjusted Performance

Weak

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.

Wrapped Bitcoin

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Wrapped Bitcoin are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Wrapped Bitcoin exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with SentinelOne and Wrapped Bitcoin

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

The idea behind SentinelOne and Wrapped Bitcoin 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.