Correlation Between Copa Holdings and AMERICAN
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By analyzing existing cross correlation between Copa Holdings SA and AMERICAN WTR CAP, you can compare the effects of market volatilities on Copa Holdings and AMERICAN 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 AMERICAN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Copa Holdings and AMERICAN.
Diversification Opportunities for Copa Holdings and AMERICAN
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Copa and AMERICAN is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Copa Holdings SA and AMERICAN WTR CAP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMERICAN WTR CAP 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 AMERICAN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMERICAN WTR CAP has no effect on the direction of Copa Holdings i.e., Copa Holdings and AMERICAN go up and down completely randomly.
Pair Corralation between Copa Holdings and AMERICAN
Considering the 90-day investment horizon Copa Holdings SA is expected to generate 4.88 times more return on investment than AMERICAN. However, Copa Holdings is 4.88 times more volatile than AMERICAN WTR CAP. It trades about 0.02 of its potential returns per unit of risk. AMERICAN WTR CAP is currently generating about -0.01 per unit of risk. If you would invest 8,019 in Copa Holdings SA on October 25, 2024 and sell it today you would earn a total of 1,200 from holding Copa Holdings SA or generate 14.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.17% |
| Values | Daily Returns |
Copa Holdings SA vs. AMERICAN WTR CAP
Performance |
| Timeline |
| Copa Holdings SA |
| AMERICAN WTR CAP |
Copa Holdings and AMERICAN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Copa Holdings and AMERICAN
The main advantage of trading using opposite Copa Holdings and AMERICAN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Copa Holdings position performs unexpectedly, AMERICAN 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 AMERICAN will offset losses from the drop in AMERICAN'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 |
| AMERICAN vs. Westrock Coffee | AMERICAN vs. Cirmaker Technology | AMERICAN vs. Compania Cervecerias Unidas | AMERICAN vs. Diageo PLC ADR |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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