Correlation Between Hawkins and Copa Holdings
Can any of the company-specific risk be diversified away by investing in both Hawkins and Copa Holdings 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 Hawkins and Copa Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hawkins and Copa Holdings SA, you can compare the effects of market volatilities on Hawkins and Copa Holdings 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 Hawkins with a short position of Copa Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hawkins and Copa Holdings.
Diversification Opportunities for Hawkins and Copa Holdings
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Hawkins and Copa is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Hawkins and Copa Holdings SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Copa Holdings SA and Hawkins 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 Hawkins are associated (or correlated) with Copa Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Copa Holdings SA has no effect on the direction of Hawkins i.e., Hawkins and Copa Holdings go up and down completely randomly.
Pair Corralation between Hawkins and Copa Holdings
Given the investment horizon of 90 days Hawkins is expected to generate 1.0 times more return on investment than Copa Holdings. However, Hawkins is 1.0 times more volatile than Copa Holdings SA. It trades about 0.23 of its potential returns per unit of risk. Copa Holdings SA is currently generating about -0.09 per unit of risk. If you would invest 11,675 in Hawkins on August 28, 2024 and sell it today you would earn a total of 1,872 from holding Hawkins or generate 16.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hawkins vs. Copa Holdings SA
Performance |
| Timeline |
| Hawkins |
| Copa Holdings SA |
Hawkins and Copa Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hawkins and Copa Holdings
The main advantage of trading using opposite Hawkins and Copa Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hawkins position performs unexpectedly, Copa Holdings 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 Copa Holdings will offset losses from the drop in Copa Holdings' long position.| Hawkins vs. H B Fuller | Hawkins vs. Minerals Technologies | Hawkins vs. Quaker Chemical | Hawkins vs. Oil Dri |
| Copa Holdings vs. SkyWest | Copa Holdings vs. Sun Country Airlines | Copa Holdings vs. Air Transport Services | Copa Holdings vs. Frontier Group Holdings |
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 Stocks Directory module to find actively traded stocks across global markets.
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