Correlation Between Check Point and LEWAG HOLDING
Can any of the company-specific risk be diversified away by investing in both Check Point and LEWAG HOLDING 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 LEWAG HOLDING 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 LEWAG HOLDING AG, you can compare the effects of market volatilities on Check Point and LEWAG HOLDING 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 LEWAG HOLDING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Check Point and LEWAG HOLDING.
Diversification Opportunities for Check Point and LEWAG HOLDING
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Check and LEWAG is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Check Point Software and LEWAG HOLDING AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LEWAG HOLDING 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 LEWAG HOLDING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LEWAG HOLDING AG has no effect on the direction of Check Point i.e., Check Point and LEWAG HOLDING go up and down completely randomly.
Pair Corralation between Check Point and LEWAG HOLDING
Assuming the 90 days trading horizon Check Point Software is expected to generate 1.36 times more return on investment than LEWAG HOLDING. However, Check Point is 1.36 times more volatile than LEWAG HOLDING AG. It trades about 0.01 of its potential returns per unit of risk. LEWAG HOLDING AG is currently generating about -0.06 per unit of risk. If you would invest 17,350 in Check Point Software on September 2, 2024 and sell it today you would lose (125.00) from holding Check Point Software or give up 0.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Check Point Software vs. LEWAG HOLDING AG
Performance |
| Timeline |
| Check Point Software |
| LEWAG HOLDING AG |
Check Point and LEWAG HOLDING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Check Point and LEWAG HOLDING
The main advantage of trading using opposite Check Point and LEWAG HOLDING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Check Point position performs unexpectedly, LEWAG HOLDING 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 LEWAG HOLDING will offset losses from the drop in LEWAG HOLDING's long position.| Check Point vs. URBAN OUTFITTERS | Check Point vs. SLR Investment Corp | Check Point vs. ECHO INVESTMENT ZY | Check Point vs. PennyMac Mortgage Investment |
| LEWAG HOLDING vs. Mobilezone Holding AG | LEWAG HOLDING vs. Iridium Communications | LEWAG HOLDING vs. Perseus Mining Limited | LEWAG HOLDING vs. Singapore Telecommunications Limited |
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.
Other Complementary Tools
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |