Correlation Between Copa Holdings and TFI International
Can any of the company-specific risk be diversified away by investing in both Copa Holdings and TFI International 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 TFI International 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 TFI International, you can compare the effects of market volatilities on Copa Holdings and TFI International 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 TFI International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Copa Holdings and TFI International.
Diversification Opportunities for Copa Holdings and TFI International
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Copa and TFI is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Copa Holdings SA and TFI International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TFI International 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 TFI International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TFI International has no effect on the direction of Copa Holdings i.e., Copa Holdings and TFI International go up and down completely randomly.
Pair Corralation between Copa Holdings and TFI International
Considering the 90-day investment horizon Copa Holdings SA is expected to under-perform the TFI International. In addition to that, Copa Holdings is 1.27 times more volatile than TFI International. It trades about -0.1 of its total potential returns per unit of risk. TFI International is currently generating about 0.22 per unit of volatility. If you would invest 13,168 in TFI International on August 24, 2024 and sell it today you would earn a total of 1,636 from holding TFI International or generate 12.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Copa Holdings SA vs. TFI International
Performance |
| Timeline |
| Copa Holdings SA |
| TFI International |
Copa Holdings and TFI International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Copa Holdings and TFI International
The main advantage of trading using opposite Copa Holdings and TFI International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Copa Holdings position performs unexpectedly, TFI International 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 TFI International will offset losses from the drop in TFI International's long position.| Copa Holdings vs. SkyWest | Copa Holdings vs. Sun Country Airlines | Copa Holdings vs. Air Transport Services | Copa Holdings vs. Frontier Group Holdings |
| TFI International vs. Small Cap Core | TFI International vs. Morningstar Unconstrained Allocation | TFI International vs. Mutual Of America | TFI International vs. Ep Emerging Markets |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |