Correlation Between Samsung Electronics and Copa Holdings
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics 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 Samsung Electronics and Copa Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung Electronics Co and Copa Holdings SA, you can compare the effects of market volatilities on Samsung Electronics 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 Samsung Electronics with a short position of Copa Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Copa Holdings.
Diversification Opportunities for Samsung Electronics and Copa Holdings
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Samsung and Copa is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co 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 Samsung Electronics 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 Samsung Electronics Co 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 Samsung Electronics i.e., Samsung Electronics and Copa Holdings go up and down completely randomly.
Pair Corralation between Samsung Electronics and Copa Holdings
If you would invest 9,384 in Copa Holdings SA on August 30, 2024 and sell it today you would lose (49.00) from holding Copa Holdings SA or give up 0.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.73% |
| Values | Daily Returns |
Samsung Electronics Co vs. Copa Holdings SA
Performance |
| Timeline |
| Samsung Electronics |
| Copa Holdings SA |
Samsung Electronics and Copa Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Copa Holdings
The main advantage of trading using opposite Samsung Electronics and Copa Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics 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.| Samsung Electronics vs. Universal Electronics | Samsung Electronics vs. Vizio Holding Corp | Samsung Electronics vs. VOXX International | Samsung Electronics vs. Sony Group Corp |
| Copa Holdings vs. American Airlines Group | Copa Holdings vs. Southwest Airlines | 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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