Correlation Between Amata Public and Copperwired Public

Can any of the company-specific risk be diversified away by investing in both Amata Public and Copperwired Public 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 Amata Public and Copperwired Public into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Amata Public and Copperwired Public, you can compare the effects of market volatilities on Amata Public and Copperwired Public 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 Amata Public with a short position of Copperwired Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amata Public and Copperwired Public.

Diversification Opportunities for Amata Public and Copperwired Public

-0.1

Correlation Coefficient

Amata Public  Copperwired Public

Good diversification

The 3 months correlation between Amata and Copperwired is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Amata Public and Copperwired Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Copperwired Public and Amata Public 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 Amata Public are associated (or correlated) with Copperwired Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Copperwired Public has no effect on the direction of Amata Public i.e., Amata Public and Copperwired Public go up and down completely randomly.

Pair Corralation between Amata Public and Copperwired Public

Assuming the 90 days trading horizon Amata Public is expected to under-perform the Copperwired Public. But the stock apears to be less risky and, when comparing its historical volatility, Amata Public is 2.77 times less risky than Copperwired Public. The stock trades about -0.13 of its potential returns per unit of risk. The Copperwired Public is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest  213.00  in Copperwired Public on December 25, 2024 and sell it today you would lose (11.00) from holding Copperwired Public or give up 5.16% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Amata Public  vs.  Copperwired Public

Amata Public

Risk-Adjusted Performance

Very Weak

Over the last 90 days Amata Public has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Amata Public is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Copperwired Public

Risk-Adjusted Performance

Very Weak

Over the last 90 days Copperwired Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Copperwired Public is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Amata Public and Copperwired Public

The main advantage of trading using opposite Amata Public and Copperwired Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amata Public position performs unexpectedly, Copperwired Public 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 Copperwired Public will offset losses from the drop in Copperwired Public's long position.

The idea behind Amata Public and Copperwired Public pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.