Correlation Between Check Point and Identiv
Can any of the company-specific risk be diversified away by investing in both Check Point and Identiv 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 Identiv 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 Identiv, you can compare the effects of market volatilities on Check Point and Identiv 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 Identiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Check Point and Identiv.
Diversification Opportunities for Check Point and Identiv
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Check and Identiv is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Check Point Software and Identiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Identiv 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 Identiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Identiv has no effect on the direction of Check Point i.e., Check Point and Identiv go up and down completely randomly.
Pair Corralation between Check Point and Identiv
Assuming the 90 days trading horizon Check Point Software is expected to generate 0.36 times more return on investment than Identiv. However, Check Point Software is 2.75 times less risky than Identiv. It trades about 0.06 of its potential returns per unit of risk. Identiv is currently generating about 0.0 per unit of risk. If you would invest 11,856 in Check Point Software on September 14, 2024 and sell it today you would earn a total of 6,329 from holding Check Point Software or generate 53.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Check Point Software vs. Identiv
Performance |
| Timeline |
| Check Point Software |
| Identiv |
Check Point and Identiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Check Point and Identiv
The main advantage of trading using opposite Check Point and Identiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Check Point position performs unexpectedly, Identiv 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 Identiv will offset losses from the drop in Identiv's long position.| Check Point vs. NISSAN CHEMICAL IND | Check Point vs. PTT Global Chemical | Check Point vs. Aedas Homes SA | Check Point vs. CHEMICAL INDUSTRIES |
| Identiv vs. Check Point Software | Identiv vs. Schweizer Electronic AG | Identiv vs. Nucletron Electronic Aktiengesellschaft | Identiv vs. Take Two Interactive Software |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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