Correlation Between Cohen Steers and Franklin Templeton
Can any of the company-specific risk be diversified away by investing in both Cohen Steers and Franklin Templeton 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 Franklin Templeton into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cohen Steers Limited and Franklin Templeton Limited, you can compare the effects of market volatilities on Cohen Steers and Franklin Templeton 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 Franklin Templeton. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cohen Steers and Franklin Templeton.
Diversification Opportunities for Cohen Steers and Franklin Templeton
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Cohen and Franklin is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Cohen Steers Limited and Franklin Templeton Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Templeton 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 Limited are associated (or correlated) with Franklin Templeton. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Templeton has no effect on the direction of Cohen Steers i.e., Cohen Steers and Franklin Templeton go up and down completely randomly.
Pair Corralation between Cohen Steers and Franklin Templeton
Considering the 90-day investment horizon Cohen Steers is expected to generate 1.57 times less return on investment than Franklin Templeton. In addition to that, Cohen Steers is 1.33 times more volatile than Franklin Templeton Limited. It trades about 0.09 of its total potential returns per unit of risk. Franklin Templeton Limited is currently generating about 0.2 per unit of volatility. If you would invest 645.00 in Franklin Templeton Limited on September 1, 2024 and sell it today you would earn a total of 13.00 from holding Franklin Templeton Limited or generate 2.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cohen Steers Limited vs. Franklin Templeton Limited
Performance |
| Timeline |
| Cohen Steers Limited |
| Franklin Templeton |
Cohen Steers and Franklin Templeton Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cohen Steers and Franklin Templeton
The main advantage of trading using opposite Cohen Steers and Franklin Templeton positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cohen Steers position performs unexpectedly, Franklin Templeton 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 Franklin Templeton will offset losses from the drop in Franklin Templeton's long position.| Cohen Steers vs. Tekla Healthcare Investors | Cohen Steers vs. Tekla Healthcare Opportunities | Cohen Steers vs. Eaton Vance Tax | Cohen Steers vs. Tekla World Healthcare |
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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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