Correlation Between FS KKR and Check Point

Can any of the company-specific risk be diversified away by investing in both FS KKR 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 FS KKR and Check Point into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between FS KKR Capital and Check Point Software, you can compare the effects of market volatilities on FS KKR 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 FS KKR with a short position of Check Point. Check out your portfolio center. Please also check ongoing floating volatility patterns of FS KKR and Check Point.

Diversification Opportunities for FS KKR and Check Point

0.6

Correlation Coefficient

FS KKR  Check Point

Poor diversification

The 3 months correlation between FSK and Check is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding FS KKR Capital 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 FS KKR 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 FS KKR Capital 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 FS KKR i.e., FS KKR and Check Point go up and down completely randomly.

Pair Corralation between FS KKR and Check Point

Considering the 90-day investment horizon FS KKR Capital is expected to under-perform the Check Point. But the stock apears to be less risky and, when comparing its historical volatility, FS KKR Capital is 1.57 times less risky than Check Point. The stock trades about -0.17 of its potential returns per unit of risk. The Check Point Software is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest  21,891  in Check Point Software on May 18, 2025 and sell it today you would lose (2,999) from holding Check Point Software or give up 13.7% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

FS KKR Capital  vs.  Check Point Software

FS KKR Capital

Risk-Adjusted Performance

Weakest

Over the last 90 days FS KKR Capital has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in September 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

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 weak performance in the last few months, the Stock's forward-looking signals remain relatively invariable which may send shares a bit higher in September 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with FS KKR and Check Point

The main advantage of trading using opposite FS KKR and Check Point positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FS KKR 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.

The idea behind FS KKR Capital and Check Point Software 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.