Correlation Between Cohen Steers and Large Cap
Can any of the company-specific risk be diversified away by investing in both Cohen Steers and Large Cap 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 Large Cap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cohen Steers Realty and Large Cap Fund, you can compare the effects of market volatilities on Cohen Steers and Large Cap 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 Large Cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cohen Steers and Large Cap.
Diversification Opportunities for Cohen Steers and Large Cap
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Cohen and Large is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Cohen Steers Realty and Large Cap Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Large Cap Fund 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 Realty are associated (or correlated) with Large Cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Large Cap Fund has no effect on the direction of Cohen Steers i.e., Cohen Steers and Large Cap go up and down completely randomly.
Pair Corralation between Cohen Steers and Large Cap
Assuming the 90 days horizon Cohen Steers Realty is expected to generate 1.11 times more return on investment than Large Cap. However, Cohen Steers is 1.11 times more volatile than Large Cap Fund. It trades about 0.14 of its potential returns per unit of risk. Large Cap Fund is currently generating about 0.09 per unit of risk. If you would invest 6,123 in Cohen Steers Realty on September 3, 2024 and sell it today you would earn a total of 978.00 from holding Cohen Steers Realty or generate 15.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cohen Steers Realty vs. Large Cap Fund
Performance |
| Timeline |
| Cohen Steers Realty |
| Large Cap Fund |
Cohen Steers and Large Cap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cohen Steers and Large Cap
The main advantage of trading using opposite Cohen Steers and Large Cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cohen Steers position performs unexpectedly, Large Cap 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 Large Cap will offset losses from the drop in Large Cap's long position.| Cohen Steers vs. Ms Global Fixed | Cohen Steers vs. Balanced Fund Retail | Cohen Steers vs. Us Vector Equity | Cohen Steers vs. Multimedia Portfolio Multimedia |
| Large Cap vs. Vanguard Total Stock | Large Cap vs. Vanguard 500 Index | Large Cap vs. Vanguard Total Stock | Large Cap vs. Vanguard Total Stock |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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