Correlation Between Cohen Steers and Fidelity Capital
Can any of the company-specific risk be diversified away by investing in both Cohen Steers and Fidelity Capital 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 Fidelity Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cohen Steers Preferred and Fidelity Capital Income, you can compare the effects of market volatilities on Cohen Steers and Fidelity Capital 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 Fidelity Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cohen Steers and Fidelity Capital.
Diversification Opportunities for Cohen Steers and Fidelity Capital
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Cohen and Fidelity is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Cohen Steers Preferred and Fidelity Capital Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Capital Income 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 Preferred are associated (or correlated) with Fidelity Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Capital Income has no effect on the direction of Cohen Steers i.e., Cohen Steers and Fidelity Capital go up and down completely randomly.
Pair Corralation between Cohen Steers and Fidelity Capital
Assuming the 90 days horizon Cohen Steers Preferred is expected to under-perform the Fidelity Capital. But the mutual fund apears to be less risky and, when comparing its historical volatility, Cohen Steers Preferred is 1.79 times less risky than Fidelity Capital. The mutual fund trades about -0.08 of its potential returns per unit of risk. The Fidelity Capital Income is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,027 in Fidelity Capital Income on September 13, 2024 and sell it today you would earn a total of 8.00 from holding Fidelity Capital Income or generate 0.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cohen Steers Preferred vs. Fidelity Capital Income
Performance |
| Timeline |
| Cohen Steers Preferred |
| Fidelity Capital Income |
Cohen Steers and Fidelity Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cohen Steers and Fidelity Capital
The main advantage of trading using opposite Cohen Steers and Fidelity Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cohen Steers position performs unexpectedly, Fidelity Capital 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 Fidelity Capital will offset losses from the drop in Fidelity Capital's long position.| Cohen Steers vs. Nuveen Preferred Securities | Cohen Steers vs. Doubleline Flexible Income | Cohen Steers vs. Cohen Steers Prfrd | Cohen Steers vs. Pimco Capital Sec |
| Fidelity Capital vs. Fidelity High Income | Fidelity Capital vs. Fidelity New Markets | Fidelity Capital vs. Fidelity Total Bond | Fidelity Capital vs. Fidelity Balanced Fund |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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