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 Mlp and Large Cap Equity, 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
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Cohen and Large is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Cohen Steers Mlp and Large Cap Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Large Cap Equity 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 Mlp 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 Equity 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 Mlp is expected to generate 0.88 times more return on investment than Large Cap. However, Cohen Steers Mlp is 1.13 times less risky than Large Cap. It trades about 0.48 of its potential returns per unit of risk. Large Cap Equity is currently generating about 0.17 per unit of risk. If you would invest 871.00 in Cohen Steers Mlp on August 31, 2024 and sell it today you would earn a total of 58.00 from holding Cohen Steers Mlp or generate 6.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cohen Steers Mlp vs. Large Cap Equity
Performance |
| Timeline |
| Cohen Steers Mlp |
| Large Cap Equity |
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. Champlain Small | Cohen Steers vs. Victory Rs Small | Cohen Steers vs. T Rowe Price | Cohen Steers vs. Tax Managed Mid Small |
| Large Cap vs. Walden Equity Fund | Large Cap vs. Large Cap Equity | Large Cap vs. Buffalo Dividend Focus | Large Cap vs. Edgar Lomax Value |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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