Correlation Between Check Point and AudioCodes

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

Diversification Opportunities for Check Point and AudioCodes

0.08

Correlation Coefficient

Check Point  AudioCodes

Significant diversification

The 3 months correlation between Check and AudioCodes is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Check Point Software and AudioCodes in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AudioCodes 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 AudioCodes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AudioCodes has no effect on the direction of Check Point i.e., Check Point and AudioCodes go up and down completely randomly.

Pair Corralation between Check Point and AudioCodes

Given the investment horizon of 90 days Check Point is expected to generate 173.7 times less return on investment than AudioCodes. But when comparing it to its historical volatility, Check Point Software is 2.57 times less risky than AudioCodes. It trades about 0.0 of its potential returns per unit of risk. AudioCodes is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  938.00  in AudioCodes on April 30, 2025 and sell it today you would earn a total of  66.00  from holding AudioCodes or generate 7.04% 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.  AudioCodes

Check Point Software

Risk-Adjusted Performance

Very Weak

Over the last 90 days Check Point Software has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable forward-looking signals, Check Point is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

AudioCodes

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in AudioCodes are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating fundamental indicators, AudioCodes may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Check Point and AudioCodes

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

The idea behind Check Point Software and AudioCodes 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.