Correlation Between Check Point and PROVIDENT
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By analyzing existing cross correlation between Check Point Software and PROVIDENT INC 725, you can compare the effects of market volatilities on Check Point and PROVIDENT 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 PROVIDENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Check Point and PROVIDENT.
Diversification Opportunities for Check Point and PROVIDENT
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Check and PROVIDENT is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Check Point Software and PROVIDENT INC 725 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PROVIDENT INC 725 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 PROVIDENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PROVIDENT INC 725 has no effect on the direction of Check Point i.e., Check Point and PROVIDENT go up and down completely randomly.
Pair Corralation between Check Point and PROVIDENT
Given the investment horizon of 90 days Check Point Software is expected to generate 1.1 times more return on investment than PROVIDENT. However, Check Point is 1.1 times more volatile than PROVIDENT INC 725. It trades about 0.08 of its potential returns per unit of risk. PROVIDENT INC 725 is currently generating about -0.01 per unit of risk. If you would invest 12,803 in Check Point Software on December 12, 2024 and sell it today you would earn a total of 9,436 from holding Check Point Software or generate 73.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 64.3% |
| Values | Daily Returns |
Check Point Software vs. PROVIDENT INC 725
Performance |
| Timeline |
| Check Point Software |
| PROVIDENT INC 725 |
Check Point and PROVIDENT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Check Point and PROVIDENT
The main advantage of trading using opposite Check Point and PROVIDENT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Check Point position performs unexpectedly, PROVIDENT 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 PROVIDENT will offset losses from the drop in PROVIDENT's long position.| Check Point vs. Rapid7 Inc | ||
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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