Correlation Between Osaka Steel and Copa Holdings

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

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

Diversification Opportunities for Osaka Steel and Copa Holdings

0.0

Correlation Coefficient

Osaka Steel  Copa Holdings

Pay attention - limited upside

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

Pair Corralation between Osaka Steel and Copa Holdings

If you would invest  8,683  in Copa Holdings SA on December 21, 2024 and sell it today you would earn a total of  772.00  from holding Copa Holdings SA or generate 8.89% return on investment over 90 days.

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

Osaka Steel Co,  vs.  Copa Holdings SA

Osaka Steel Co,

Risk-Adjusted Performance

Very Weak

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

Copa Holdings SA

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Copa Holdings SA are ranked lower than 7 (%) 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 Osaka Steel and Copa Holdings

The main advantage of trading using opposite Osaka Steel and Copa Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Osaka Steel 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 Osaka Steel Co, 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.