Correlation Between Copa Holdings and SBA Communications
Can any of the company-specific risk be diversified away by investing in both Copa Holdings and SBA Communications 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 Copa Holdings and SBA Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Copa Holdings SA and SBA Communications Corp, you can compare the effects of market volatilities on Copa Holdings and SBA Communications 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 Copa Holdings with a short position of SBA Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Copa Holdings and SBA Communications.
Diversification Opportunities for Copa Holdings and SBA Communications
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Copa and SBA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Copa Holdings SA and SBA Communications Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SBA Communications Corp and Copa Holdings 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 Copa Holdings SA are associated (or correlated) with SBA Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SBA Communications Corp has no effect on the direction of Copa Holdings i.e., Copa Holdings and SBA Communications go up and down completely randomly.
Pair Corralation between Copa Holdings and SBA Communications
Assuming the 90 days horizon Copa Holdings SA is expected to generate 1.24 times more return on investment than SBA Communications. However, Copa Holdings is 1.24 times more volatile than SBA Communications Corp. It trades about 0.03 of its potential returns per unit of risk. SBA Communications Corp is currently generating about -0.02 per unit of risk. If you would invest 7,050 in Copa Holdings SA on September 3, 2024 and sell it today you would earn a total of 1,900 from holding Copa Holdings SA or generate 26.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Copa Holdings SA vs. SBA Communications Corp
Performance |
| Timeline |
| Copa Holdings SA |
| SBA Communications Corp |
Copa Holdings and SBA Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Copa Holdings and SBA Communications
The main advantage of trading using opposite Copa Holdings and SBA Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Copa Holdings position performs unexpectedly, SBA Communications 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 SBA Communications will offset losses from the drop in SBA Communications' long position.| Copa Holdings vs. Tower Semiconductor | Copa Holdings vs. PLAY2CHILL SA ZY | Copa Holdings vs. ON SEMICONDUCTOR | Copa Holdings vs. LG Display Co |
| SBA Communications vs. Luckin Coffee | SBA Communications vs. REVO INSURANCE SPA | SBA Communications vs. Selective Insurance Group | SBA Communications vs. Goosehead Insurance |
Check out your portfolio center.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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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