Correlation Between Check Point and Sligro Food
Can any of the company-specific risk be diversified away by investing in both Check Point and Sligro Food 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 Check Point and Sligro Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Check Point Software and Sligro Food Group, you can compare the effects of market volatilities on Check Point and Sligro Food 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 Check Point with a short position of Sligro Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Check Point and Sligro Food.
Diversification Opportunities for Check Point and Sligro Food
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Check and Sligro is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Check Point Software and Sligro Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sligro Food Group and Check Point 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 Check Point Software are associated (or correlated) with Sligro Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sligro Food Group has no effect on the direction of Check Point i.e., Check Point and Sligro Food go up and down completely randomly.
Pair Corralation between Check Point and Sligro Food
Assuming the 90 days trading horizon Check Point Software is expected to under-perform the Sligro Food. In addition to that, Check Point is 3.1 times more volatile than Sligro Food Group. It trades about -0.18 of its total potential returns per unit of risk. Sligro Food Group is currently generating about -0.37 per unit of volatility. If you would invest 1,181 in Sligro Food Group on August 29, 2024 and sell it today you would lose (100.00) from holding Sligro Food Group or give up 8.47% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Check Point Software vs. Sligro Food Group
Performance |
| Timeline |
| Check Point Software |
| Sligro Food Group |
Check Point and Sligro Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Check Point and Sligro Food
The main advantage of trading using opposite Check Point and Sligro Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Check Point position performs unexpectedly, Sligro Food 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 Sligro Food will offset losses from the drop in Sligro Food's long position.| Check Point vs. Toyota Motor Corp | Check Point vs. OTP Bank Nyrt | Check Point vs. Cognizant Technology Solutions | Check Point vs. Lendinvest PLC |
| Sligro Food vs. Lendinvest PLC | Sligro Food vs. Neometals | Sligro Food vs. Coor Service Management | Sligro Food vs. Albion Technology General |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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