Correlation Between Telecom Argentina and Check Point

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

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

Diversification Opportunities for Telecom Argentina and Check Point

0.38

Correlation Coefficient

Telecom Argentina  Check Point

Weak diversification

The 3 months correlation between Telecom and Check is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Telecom Argentina SA 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 Telecom Argentina 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 Telecom Argentina SA 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 Telecom Argentina i.e., Telecom Argentina and Check Point go up and down completely randomly.

Pair Corralation between Telecom Argentina and Check Point

Assuming the 90 days horizon Telecom Argentina SA is expected to generate 1.49 times more return on investment than Check Point. However, Telecom Argentina is 1.49 times more volatile than Check Point Software. It trades about -0.08 of its potential returns per unit of risk. Check Point Software is currently generating about -0.15 per unit of risk. If you would invest  945.00  in Telecom Argentina SA on May 10, 2025 and sell it today you would lose (145.00) from holding Telecom Argentina SA or give up 15.34% of portfolio value over 90 days.

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

Telecom Argentina SA  vs.  Check Point Software

Telecom Argentina

Risk-Adjusted Performance

Weakest

Over the last 90 days Telecom Argentina SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in September 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

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. In spite of fragile performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in September 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Telecom Argentina and Check Point

The main advantage of trading using opposite Telecom Argentina and Check Point positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telecom Argentina 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 Telecom Argentina SA 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.