ALRM vs SSTI: Correlation
Alarm.com Holdings, Inc. (ALRM) and SoundThinking, Inc. (SSTI) show a moderate relationship: their 3-year correlation of weekly returns is 0.42.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are ALRM and SSTI?
Over the past 3 years, ALRM and SSTI moved with a correlation of 0.42, which is moderate. Little has changed lately, as the 1-year reading of 0.40 lands near the 3-year figure. Over 5 years the correlation is 0.33, and the annualized covariance of weekly returns is 630.2 %².
Out of 17 assets tracked against ALRM, SSTI lands near the bottom at #13. Their recent paths diverged sharply: over the last 12 months ALRM outperformed by 47.7 percentage points (-1.6% for ALRM against -49.3% for SSTI). Note the risk asymmetry: SSTI runs 1.9 times the annualized volatility of the other leg, so equal-weighting the two is not an equal-risk position.
How is this computed?
Pearson correlation on weekly returns: ρ(A,B) = cov(rA, rB) / (σA · σB), over windows of 52, 156 and 260 weeks. Covariance is annualized (×52) and expressed in %². Full definitions on the methodology page.
ALRM vs SSTI: side by side
| ALRM (Alarm.com Holdings, Inc.) | SSTI (SoundThinking, Inc.) | |
|---|---|---|
| 1-year return | -1.6% | -49.3% |
| 5-year return | -30.9% | -83.7% |
| Volatility (ann.) | 28.1% | 53.5% |
| Beta vs S&P 500 | 0.96 | 1.25 |
| Max drawdown (3Y) | -44.3% | -78.3% |
| Market cap | $2.8B | $0.1B |
| P/E (trailing) | 25.5 | – |
| Dividend yield | 0.00% | 0.00% |
| Sector / category | US Listed | US Listed |
Year-by-year returns
| Year | ALRM | SSTI |
|---|---|---|
| 2022 | -41.7% | +14.6% |
| 2023 | +30.6% | -24.5% |
| 2024 | -5.9% | -48.9% |
| 2025 | -16.1% | -38.5% |
| 2026 | +12.9% | -21.3% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are ALRM and SSTI good diversifiers for each other?
Reasonably. At 0.42, ALRM and SSTI keep a meaningful degree of independence, and combining them has historically reduced portfolio volatility.
FAQ
What is the correlation between ALRM and SSTI?
The ALRM/SSTI correlation stands at 0.42 on a 3-year window (1 year: 0.40, 5 years: 0.33), computed from weekly returns as of 2026-08-27.
Is SSTI a good diversifier for ALRM?
Reasonably. At 0.42, ALRM and SSTI keep a meaningful degree of independence, and combining them has historically reduced portfolio volatility.
What does a correlation of 0.42 mean?
A reading of 0.42 sits on a scale from −1 (opposite moves) through 0 (unrelated) to +1 (identical moves). Correlation captures direction, not magnitude or performance.
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Related comparisons
Hubs: ALRM correlations · SSTI correlations
