Correlation Between Copa Holdings and CXApp
Can any of the company-specific risk be diversified away by investing in both Copa Holdings and CXApp 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 CXApp 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 CXApp Inc, you can compare the effects of market volatilities on Copa Holdings and CXApp 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 CXApp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Copa Holdings and CXApp.
Diversification Opportunities for Copa Holdings and CXApp
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Copa and CXApp is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Copa Holdings SA and CXApp Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CXApp Inc 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 CXApp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CXApp Inc has no effect on the direction of Copa Holdings i.e., Copa Holdings and CXApp go up and down completely randomly.
Pair Corralation between Copa Holdings and CXApp
Considering the 90-day investment horizon Copa Holdings SA is expected to under-perform the CXApp. But the stock apears to be less risky and, when comparing its historical volatility, Copa Holdings SA is 7.87 times less risky than CXApp. The stock trades about -0.02 of its potential returns per unit of risk. The CXApp Inc is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 7.95 in CXApp Inc on September 14, 2024 and sell it today you would earn a total of 12.05 from holding CXApp Inc or generate 151.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.2% |
| Values | Daily Returns |
Copa Holdings SA vs. CXApp Inc
Performance |
| Timeline |
| Copa Holdings SA |
| CXApp Inc |
Copa Holdings and CXApp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Copa Holdings and CXApp
The main advantage of trading using opposite Copa Holdings and CXApp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Copa Holdings position performs unexpectedly, CXApp 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 CXApp will offset losses from the drop in CXApp's long position.| Copa Holdings vs. Southwest Airlines | Copa Holdings vs. United Airlines Holdings | Copa Holdings vs. Frontier Group Holdings |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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