Correlation Between Check Point and Intuitive Investments

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

Diversification Opportunities for Check Point and Intuitive Investments

0.46

Correlation Coefficient

Check Point  Intuitive Investments

Very weak diversification

The 3 months correlation between Check and Intuitive is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Check Point Software and Intuitive Investments Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intuitive Investments 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 Intuitive Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intuitive Investments has no effect on the direction of Check Point i.e., Check Point and Intuitive Investments go up and down completely randomly.

Pair Corralation between Check Point and Intuitive Investments

Assuming the 90 days trading horizon Check Point is expected to generate 4.27 times less return on investment than Intuitive Investments. But when comparing it to its historical volatility, Check Point Software is 1.69 times less risky than Intuitive Investments. It trades about 0.04 of its potential returns per unit of risk. Intuitive Investments Group is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  10,450  in Intuitive Investments Group on April 22, 2025 and sell it today you would earn a total of  1,650  from holding Intuitive Investments Group or generate 15.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.41%
Values	Daily Returns

Check Point Software  vs.  Intuitive Investments Group

Check Point Software

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Check Point Software are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Check Point is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Intuitive Investments

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Intuitive Investments Group are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Intuitive Investments exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Check Point and Intuitive Investments

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

The idea behind Check Point Software and Intuitive Investments Group 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.