Correlation Between Check Point and Okta
Can any of the company-specific risk be diversified away by investing in both Check Point and Okta 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 Okta 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 Okta Inc, you can compare the effects of market volatilities on Check Point and Okta 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 Okta. Check out your portfolio center. Please also check ongoing floating volatility patterns of Check Point and Okta.
Diversification Opportunities for Check Point and Okta
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Check and Okta is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Check Point Software and Okta Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Okta Inc 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 Okta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Okta Inc has no effect on the direction of Check Point i.e., Check Point and Okta go up and down completely randomly.
Pair Corralation between Check Point and Okta
Given the investment horizon of 90 days Check Point Software is expected to under-perform the Okta. In addition to that, Check Point is 1.92 times more volatile than Okta Inc. It trades about -0.16 of its total potential returns per unit of risk. Okta Inc is currently generating about 0.13 per unit of volatility. If you would invest 7,325 in Okta Inc on August 28, 2024 and sell it today you would earn a total of 325.00 from holding Okta Inc or generate 4.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Check Point Software vs. Okta Inc
Performance |
| Timeline |
| Check Point Software |
| Okta Inc |
Check Point and Okta Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Check Point and Okta
The main advantage of trading using opposite Check Point and Okta positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Check Point position performs unexpectedly, Okta 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 Okta will offset losses from the drop in Okta's long position.| Check Point vs. GigaCloud Technology Class | Check Point vs. Arqit Quantum | Check Point vs. Cemtrex | Check Point vs. Paysafe |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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