Correlation Between Equity Growth and Cohen Steers
Can any of the company-specific risk be diversified away by investing in both Equity Growth 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 Equity Growth and Cohen Steers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Equity Growth Fund and Cohen Steers Reit, you can compare the effects of market volatilities on Equity Growth 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 Equity Growth with a short position of Cohen Steers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Equity Growth and Cohen Steers.
Diversification Opportunities for Equity Growth and Cohen Steers
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Equity and Cohen is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Equity Growth Fund and Cohen Steers Reit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cohen Steers Reit and Equity Growth 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 Equity Growth Fund 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 Reit has no effect on the direction of Equity Growth i.e., Equity Growth and Cohen Steers go up and down completely randomly.
Pair Corralation between Equity Growth and Cohen Steers
Assuming the 90 days horizon Equity Growth Fund is expected to generate 0.66 times more return on investment than Cohen Steers. However, Equity Growth Fund is 1.5 times less risky than Cohen Steers. It trades about 0.22 of its potential returns per unit of risk. Cohen Steers Reit is currently generating about 0.02 per unit of risk. If you would invest 3,131 in Equity Growth Fund on September 3, 2024 and sell it today you would earn a total of 324.00 from holding Equity Growth Fund or generate 10.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Equity Growth Fund vs. Cohen Steers Reit
Performance |
| Timeline |
| Equity Growth |
| Cohen Steers Reit |
Equity Growth and Cohen Steers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Equity Growth and Cohen Steers
The main advantage of trading using opposite Equity Growth and Cohen Steers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Equity Growth 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.| Equity Growth vs. Blrc Sgy Mnp | Equity Growth vs. Maryland Tax Free Bond | Equity Growth vs. Ambrus Core Bond | Equity Growth vs. Ab Bond Inflation |
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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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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