Correlation Between Check Point and UNIQA INSURANCE

Can any of the company-specific risk be diversified away by investing in both Check Point and UNIQA INSURANCE 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 UNIQA INSURANCE 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 UNIQA INSURANCE GR, you can compare the effects of market volatilities on Check Point and UNIQA INSURANCE 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 UNIQA INSURANCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Check Point and UNIQA INSURANCE.

Diversification Opportunities for Check Point and UNIQA INSURANCE

0.37

Correlation Coefficient

Check Point  UNIQA INSURANCE

Weak diversification

The 3 months correlation between Check and UNIQA is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Check Point Software and UNIQA INSURANCE GR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UNIQA INSURANCE GR 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 UNIQA INSURANCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UNIQA INSURANCE GR has no effect on the direction of Check Point i.e., Check Point and UNIQA INSURANCE go up and down completely randomly.

Pair Corralation between Check Point and UNIQA INSURANCE

Assuming the 90 days trading horizon Check Point Software is expected to under-perform the UNIQA INSURANCE. In addition to that, Check Point is 2.06 times more volatile than UNIQA INSURANCE GR. It trades about -0.03 of its total potential returns per unit of risk. UNIQA INSURANCE GR is currently generating about 0.15 per unit of volatility. If you would invest  733.00  in UNIQA INSURANCE GR on October 23, 2024 and sell it today you would earn a total of  72.00  from holding UNIQA INSURANCE GR or generate 9.82% 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.  UNIQA INSURANCE GR

Check Point Software

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Check Point Software has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Check Point is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

UNIQA INSURANCE GR

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in UNIQA INSURANCE GR are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, UNIQA INSURANCE may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Check Point and UNIQA INSURANCE

The main advantage of trading using opposite Check Point and UNIQA INSURANCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Check Point position performs unexpectedly, UNIQA INSURANCE 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 UNIQA INSURANCE will offset losses from the drop in UNIQA INSURANCE's long position.

The idea behind Check Point Software and UNIQA INSURANCE GR pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.