Correlation Between Check Point and Verint Systems

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

Diversification Opportunities for Check Point and Verint Systems

0.31

Correlation Coefficient

Check Point  Verint Systems

Weak diversification

The 3 months correlation between Check and Verint is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Check Point Software and Verint Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Verint Systems 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 Verint Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Verint Systems has no effect on the direction of Check Point i.e., Check Point and Verint Systems go up and down completely randomly.

Pair Corralation between Check Point and Verint Systems

Given the investment horizon of 90 days Check Point Software is expected to under-perform the Verint Systems. But the stock apears to be less risky and, when comparing its historical volatility, Check Point Software is 1.3 times less risky than Verint Systems. The stock trades about -0.04 of its potential returns per unit of risk. The Verint Systems is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  1,967  in Verint Systems on June 29, 2025 and sell it today you would earn a total of  59.00  from holding Verint Systems or generate 3.0% 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.  Verint Systems

Check Point Software

Risk-Adjusted Performance

Weakest

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.

Verint Systems

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Verint Systems are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Verint Systems is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Check Point and Verint Systems

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

The idea behind Check Point Software and Verint Systems 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.