Correlation Between Hilton Food and Check Point
Can any of the company-specific risk be diversified away by investing in both Hilton Food and Check Point 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 Hilton Food and Check Point into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hilton Food Group and Check Point Software, you can compare the effects of market volatilities on Hilton Food and Check Point 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 Hilton Food with a short position of Check Point. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hilton Food and Check Point.
Diversification Opportunities for Hilton Food and Check Point
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hilton and Check is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Hilton Food Group and Check Point Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Check Point Software and Hilton Food 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 Hilton Food Group are associated (or correlated) with Check Point. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Check Point Software has no effect on the direction of Hilton Food i.e., Hilton Food and Check Point go up and down completely randomly.
Pair Corralation between Hilton Food and Check Point
Assuming the 90 days trading horizon Hilton Food Group is expected to generate 0.89 times more return on investment than Check Point. However, Hilton Food Group is 1.13 times less risky than Check Point. It trades about 0.09 of its potential returns per unit of risk. Check Point Software is currently generating about 0.06 per unit of risk. If you would invest 70,010 in Hilton Food Group on August 25, 2024 and sell it today you would earn a total of 21,990 from holding Hilton Food Group or generate 31.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.2% |
| Values | Daily Returns |
Hilton Food Group vs. Check Point Software
Performance |
| Timeline |
| Hilton Food Group |
| Check Point Software |
Hilton Food and Check Point Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hilton Food and Check Point
The main advantage of trading using opposite Hilton Food and Check Point positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hilton Food position performs unexpectedly, Check Point 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 Check Point will offset losses from the drop in Check Point's long position.| Hilton Food vs. Zanaga Iron Ore | Hilton Food vs. Axway Software SA | Hilton Food vs. Take Two Interactive Software | Hilton Food vs. JLEN Environmental Assets |
| Check Point vs. Toyota Motor Corp | Check Point vs. SoftBank Group Corp | Check Point vs. OTP Bank Nyrt | Check Point vs. Yum Brands |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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