Correlation Between Check Point and MHP Hotel
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By analyzing existing cross correlation between Check Point Software and MHP Hotel AG, you can compare the effects of market volatilities on Check Point and MHP Hotel 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 MHP Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Check Point and MHP Hotel.
Diversification Opportunities for Check Point and MHP Hotel
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Check and MHP is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Check Point Software and MHP Hotel AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MHP Hotel AG 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 MHP Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MHP Hotel AG has no effect on the direction of Check Point i.e., Check Point and MHP Hotel go up and down completely randomly.
Pair Corralation between Check Point and MHP Hotel
Assuming the 90 days trading horizon Check Point Software is expected to generate 0.58 times more return on investment than MHP Hotel. However, Check Point Software is 1.72 times less risky than MHP Hotel. It trades about 0.05 of its potential returns per unit of risk. MHP Hotel AG is currently generating about 0.01 per unit of risk. If you would invest 12,570 in Check Point Software on August 24, 2024 and sell it today you would earn a total of 4,740 from holding Check Point Software or generate 37.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Check Point Software vs. MHP Hotel AG
Performance |
| Timeline |
| Check Point Software |
| MHP Hotel AG |
Check Point and MHP Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Check Point and MHP Hotel
The main advantage of trading using opposite Check Point and MHP Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Check Point position performs unexpectedly, MHP Hotel 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 MHP Hotel will offset losses from the drop in MHP Hotel's long position.| Check Point vs. Clean Energy Fuels | Check Point vs. InterContinental Hotels Group | Check Point vs. Regal Hotels International | Check Point vs. ALERION CLEANPOWER |
| MHP Hotel vs. Lloyds Banking Group | MHP Hotel vs. KB Financial Group | MHP Hotel vs. ORIX Corporation | MHP Hotel vs. Orix Corp Ads |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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