Correlation Between CF Acquisition and Cohen Steers
Can any of the company-specific risk be diversified away by investing in both CF Acquisition 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 CF Acquisition and Cohen Steers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CF Acquisition VII and Cohen Steers Tax Advantaged, you can compare the effects of market volatilities on CF Acquisition 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 CF Acquisition with a short position of Cohen Steers. Check out your portfolio center. Please also check ongoing floating volatility patterns of CF Acquisition and Cohen Steers.
Diversification Opportunities for CF Acquisition and Cohen Steers
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between CFFS and Cohen is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding CF Acquisition VII and Cohen Steers Tax Advantaged in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cohen Steers Tax and CF Acquisition 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 CF Acquisition VII 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 Tax has no effect on the direction of CF Acquisition i.e., CF Acquisition and Cohen Steers go up and down completely randomly.
Pair Corralation between CF Acquisition and Cohen Steers
Given the investment horizon of 90 days CF Acquisition VII is expected to generate 0.31 times more return on investment than Cohen Steers. However, CF Acquisition VII is 3.22 times less risky than Cohen Steers. It trades about 0.17 of its potential returns per unit of risk. Cohen Steers Tax Advantaged is currently generating about 0.04 per unit of risk. If you would invest 1,110 in CF Acquisition VII on September 2, 2024 and sell it today you would earn a total of 10.00 from holding CF Acquisition VII or generate 0.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CF Acquisition VII vs. Cohen Steers Tax Advantaged
Performance |
| Timeline |
| CF Acquisition VII |
| Cohen Steers Tax |
CF Acquisition and Cohen Steers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CF Acquisition and Cohen Steers
The main advantage of trading using opposite CF Acquisition and Cohen Steers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CF Acquisition 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.The idea behind CF Acquisition VII and Cohen Steers Tax Advantaged 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.| Cohen Steers vs. Blackrock Muni Intermediate | Cohen Steers vs. Nuveen Dynamic Municipal | Cohen Steers vs. Blackrock Muniyield Quality | Cohen Steers vs. DWS Municipal Income |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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