Correlation Between Gentera SAB and Copa Holdings

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

By analyzing existing cross correlation between Gentera SAB de and Copa Holdings SA, you can compare the effects of market volatilities on Gentera SAB 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 Gentera SAB with a short position of Copa Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gentera SAB and Copa Holdings.

Diversification Opportunities for Gentera SAB and Copa Holdings

0.0

Correlation Coefficient

Gentera SAB  Copa Holdings

Pay attention - limited upside

The 3 months correlation between Gentera and Copa is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Gentera SAB de 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 Gentera SAB 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 Gentera SAB de 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 Gentera SAB i.e., Gentera SAB and Copa Holdings go up and down completely randomly.

Pair Corralation between Gentera SAB and Copa Holdings

If you would invest  8,612  in Copa Holdings SA on December 27, 2024 and sell it today you would earn a total of  939.00  from holding Copa Holdings SA or generate 10.9% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

Gentera SAB de  vs.  Copa Holdings SA

Gentera SAB de

Risk-Adjusted Performance

Very Weak

Over the last 90 days Gentera SAB de has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Gentera SAB is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Copa Holdings SA

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Copa Holdings SA are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat abnormal basic indicators, Copa Holdings may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Gentera SAB and Copa Holdings

The main advantage of trading using opposite Gentera SAB and Copa Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gentera SAB 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.

The idea behind Gentera SAB de and Copa Holdings SA 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.