Correlation Between First Trust and Cohen Steers
Can any of the company-specific risk be diversified away by investing in both First Trust 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 First Trust and Cohen Steers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Trust Mlp and Cohen Steers Reit, you can compare the effects of market volatilities on First Trust 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 First Trust with a short position of Cohen Steers. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Trust and Cohen Steers.
Diversification Opportunities for First Trust and Cohen Steers
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between First and Cohen is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding First Trust Mlp and Cohen Steers Reit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cohen Steers Reit and First Trust 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 First Trust Mlp 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 Reit has no effect on the direction of First Trust i.e., First Trust and Cohen Steers go up and down completely randomly.
Pair Corralation between First Trust and Cohen Steers
Considering the 90-day investment horizon First Trust Mlp is expected to generate 0.96 times more return on investment than Cohen Steers. However, First Trust Mlp is 1.04 times less risky than Cohen Steers. It trades about 0.16 of its potential returns per unit of risk. Cohen Steers Reit is currently generating about 0.08 per unit of risk. If you would invest 740.00 in First Trust Mlp on August 29, 2024 and sell it today you would earn a total of 75.00 from holding First Trust Mlp or generate 10.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 13.74% |
| Values | Daily Returns |
First Trust Mlp vs. Cohen Steers Reit
Performance |
| Timeline |
| First Trust Mlp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Cohen Steers Reit |
First Trust and Cohen Steers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Trust and Cohen Steers
The main advantage of trading using opposite First Trust and Cohen Steers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Trust 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.| First Trust vs. Franklin Templeton Limited | First Trust vs. Blackrock Floating Rate | First Trust vs. Cohen Steers Limited | First Trust vs. Eagle Point Income |
| Cohen Steers vs. Cohen And Steers | Cohen Steers vs. Cohen Steers Total | Cohen Steers vs. Reaves Utility If | Cohen Steers vs. BlackRock Science Tech |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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