Correlation Between COPAUR MINERALS and Ecopetrol

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

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

Diversification Opportunities for COPAUR MINERALS and Ecopetrol

-0.33

Correlation Coefficient

COPAUR MINERALS  Ecopetrol

Very good diversification

The 3 months correlation between COPAUR and Ecopetrol is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding COPAUR MINERALS INC and Ecopetrol SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ecopetrol SA and COPAUR MINERALS 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 COPAUR MINERALS INC are associated (or correlated) with Ecopetrol. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ecopetrol SA has no effect on the direction of COPAUR MINERALS i.e., COPAUR MINERALS and Ecopetrol go up and down completely randomly.

Pair Corralation between COPAUR MINERALS and Ecopetrol

Assuming the 90 days trading horizon COPAUR MINERALS INC is expected to generate 3.13 times more return on investment than Ecopetrol. However, COPAUR MINERALS is 3.13 times more volatile than Ecopetrol SA. It trades about 0.01 of its potential returns per unit of risk. Ecopetrol SA is currently generating about 0.01 per unit of risk. If you would invest  7.68  in COPAUR MINERALS INC on April 24, 2025 and sell it today you would lose (0.82) from holding COPAUR MINERALS INC or give up 10.68% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

COPAUR MINERALS INC  vs.  Ecopetrol SA

COPAUR MINERALS INC

Risk-Adjusted Performance

Very Weak

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

Ecopetrol SA

Risk-Adjusted Performance

Very Weak

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

Pair Trading with COPAUR MINERALS and Ecopetrol

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

The idea behind COPAUR MINERALS INC and Ecopetrol 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.

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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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.