Correlation Between Check Point and Gaztransport
Can any of the company-specific risk be diversified away by investing in both Check Point and Gaztransport 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 Gaztransport 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 Gaztransport et Technigaz, you can compare the effects of market volatilities on Check Point and Gaztransport 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 Gaztransport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Check Point and Gaztransport.
Diversification Opportunities for Check Point and Gaztransport
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Check and Gaztransport is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Check Point Software and Gaztransport et Technigaz in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gaztransport et Technigaz 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 Gaztransport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gaztransport et Technigaz has no effect on the direction of Check Point i.e., Check Point and Gaztransport go up and down completely randomly.
Pair Corralation between Check Point and Gaztransport
Assuming the 90 days trading horizon Check Point is expected to generate 1.08 times less return on investment than Gaztransport. But when comparing it to its historical volatility, Check Point Software is 1.14 times less risky than Gaztransport. It trades about 0.08 of its potential returns per unit of risk. Gaztransport et Technigaz is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 8,907 in Gaztransport et Technigaz on August 31, 2024 and sell it today you would earn a total of 4,873 from holding Gaztransport et Technigaz or generate 54.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 97.24% |
| Values | Daily Returns |
Check Point Software vs. Gaztransport et Technigaz
Performance |
| Timeline |
| Check Point Software |
| Gaztransport et Technigaz |
Check Point and Gaztransport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Check Point and Gaztransport
The main advantage of trading using opposite Check Point and Gaztransport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Check Point position performs unexpectedly, Gaztransport 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 Gaztransport will offset losses from the drop in Gaztransport's long position.| Check Point vs. Charter Communications Cl | Check Point vs. Tatton Asset Management | Check Point vs. Ecclesiastical Insurance Office | Check Point vs. Taylor Maritime Investments |
| Gaztransport vs. Neometals | Gaztransport vs. Coor Service Management | Gaztransport vs. Aeorema Communications Plc | Gaztransport vs. JLEN Environmental Assets |
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.
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