Correlation Between Franklin Adjustable and Cohen Steers
Can any of the company-specific risk be diversified away by investing in both Franklin Adjustable 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 Franklin Adjustable and Cohen Steers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Adjustable Government and Cohen Steers International, you can compare the effects of market volatilities on Franklin Adjustable 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 Franklin Adjustable with a short position of Cohen Steers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Adjustable and Cohen Steers.
Diversification Opportunities for Franklin Adjustable and Cohen Steers
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Franklin and Cohen is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Adjustable Government and Cohen Steers International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cohen Steers Interna and Franklin Adjustable 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 Franklin Adjustable Government 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 Interna has no effect on the direction of Franklin Adjustable i.e., Franklin Adjustable and Cohen Steers go up and down completely randomly.
Pair Corralation between Franklin Adjustable and Cohen Steers
Assuming the 90 days horizon Franklin Adjustable Government is not expected to generate positive returns. However, Franklin Adjustable Government is 11.7 times less risky than Cohen Steers. It waists most of its returns potential to compensate for thr risk taken. Cohen Steers is generating about 0.21 per unit of risk. If you would invest 787.00 in Cohen Steers International on November 3, 2024 and sell it today you would earn a total of 29.00 from holding Cohen Steers International or generate 3.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Adjustable Government vs. Cohen Steers International
Performance |
| Timeline |
| Franklin Adjustable |
| Cohen Steers Interna |
Franklin Adjustable and Cohen Steers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Adjustable and Cohen Steers
The main advantage of trading using opposite Franklin Adjustable and Cohen Steers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Adjustable 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 Franklin Adjustable Government and Cohen Steers International 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. Franklin Adjustable Government | Cohen Steers vs. Aig Government Money | Cohen Steers vs. Prudential Government Money | Cohen Steers vs. Hsbc Government Money |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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