Correlation Between Growth Fund and Cohen Steers
Can any of the company-specific risk be diversified away by investing in both Growth Fund and Cohen Steers 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 Growth Fund and Cohen Steers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Growth Fund Of and Cohen Steers Low, you can compare the effects of market volatilities on Growth Fund and Cohen Steers 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 Growth Fund with a short position of Cohen Steers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Growth Fund and Cohen Steers.
Diversification Opportunities for Growth Fund and Cohen Steers
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Growth and Cohen is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Growth Fund Of and Cohen Steers Low in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cohen Steers Low and Growth Fund 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 Growth Fund Of are associated (or correlated) with Cohen Steers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cohen Steers Low has no effect on the direction of Growth Fund i.e., Growth Fund and Cohen Steers go up and down completely randomly.
Pair Corralation between Growth Fund and Cohen Steers
Assuming the 90 days horizon Growth Fund Of is expected to generate 7.68 times more return on investment than Cohen Steers. However, Growth Fund is 7.68 times more volatile than Cohen Steers Low. It trades about 0.24 of its potential returns per unit of risk. Cohen Steers Low is currently generating about 0.16 per unit of risk. If you would invest 7,457 in Growth Fund Of on November 3, 2024 and sell it today you would earn a total of 374.00 from holding Growth Fund Of or generate 5.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Growth Fund Of vs. Cohen Steers Low
Performance |
| Timeline |
| Growth Fund |
| Cohen Steers Low |
Growth Fund and Cohen Steers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Growth Fund and Cohen Steers
The main advantage of trading using opposite Growth Fund and Cohen Steers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Growth Fund position performs unexpectedly, Cohen Steers 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 Cohen Steers will offset losses from the drop in Cohen Steers' long position.| Growth Fund vs. Capital World Growth | Growth Fund vs. Europacific Growth Fund | Growth Fund vs. New Perspective Fund | Growth Fund vs. Investment Of America |
| Cohen Steers vs. Touchstone Large Cap | Cohen Steers vs. Rational Strategic Allocation | Cohen Steers vs. Morningstar Global Income | Cohen Steers vs. Fm Investments Large |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |