Correlation Between Cohen Steers and Great Elm
Can any of the company-specific risk be diversified away by investing in both Cohen Steers and Great Elm 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 Cohen Steers and Great Elm into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cohen Steers and Great Elm Capital, you can compare the effects of market volatilities on Cohen Steers and Great Elm 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 Cohen Steers with a short position of Great Elm. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cohen Steers and Great Elm.
Diversification Opportunities for Cohen Steers and Great Elm
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cohen and Great is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Cohen Steers and Great Elm Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Great Elm Capital and Cohen Steers 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 Cohen Steers are associated (or correlated) with Great Elm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Great Elm Capital has no effect on the direction of Cohen Steers i.e., Cohen Steers and Great Elm go up and down completely randomly.
Pair Corralation between Cohen Steers and Great Elm
Considering the 90-day investment horizon Cohen Steers is expected to generate 3.9 times more return on investment than Great Elm. However, Cohen Steers is 3.9 times more volatile than Great Elm Capital. It trades about 0.2 of its potential returns per unit of risk. Great Elm Capital is currently generating about 0.07 per unit of risk. If you would invest 7,018 in Cohen Steers on August 30, 2024 and sell it today you would earn a total of 3,445 from holding Cohen Steers or generate 49.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cohen Steers vs. Great Elm Capital
Performance |
| Timeline |
| Cohen Steers |
| Great Elm Capital |
Cohen Steers and Great Elm Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cohen Steers and Great Elm
The main advantage of trading using opposite Cohen Steers and Great Elm positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cohen Steers position performs unexpectedly, Great Elm 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 Great Elm will offset losses from the drop in Great Elm's long position.| Cohen Steers vs. Federated Premier Municipal | Cohen Steers vs. Blackrock Muniyield | Cohen Steers vs. Diamond Hill Investment | Cohen Steers vs. NXG NextGen Infrastructure |
| Great Elm vs. Gladstone Investment | Great Elm vs. HUMANA INC | Great Elm vs. Aquagold International | Great Elm vs. Barloworld Ltd ADR |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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