Correlation Between Okta and Cohen Steers
Can any of the company-specific risk be diversified away by investing in both Okta 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 Okta and Cohen Steers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Okta Inc and Cohen Steers Real, you can compare the effects of market volatilities on Okta 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 Okta with a short position of Cohen Steers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Okta and Cohen Steers.
Diversification Opportunities for Okta and Cohen Steers
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Okta and Cohen is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Okta Inc and Cohen Steers Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cohen Steers Real and Okta 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 Okta Inc 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 Real has no effect on the direction of Okta i.e., Okta and Cohen Steers go up and down completely randomly.
Pair Corralation between Okta and Cohen Steers
Given the investment horizon of 90 days Okta Inc is expected to generate 1.36 times more return on investment than Cohen Steers. However, Okta is 1.36 times more volatile than Cohen Steers Real. It trades about 0.16 of its potential returns per unit of risk. Cohen Steers Real is currently generating about -0.08 per unit of risk. If you would invest 7,216 in Okta Inc on August 24, 2024 and sell it today you would earn a total of 441.00 from holding Okta Inc or generate 6.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Okta Inc vs. Cohen Steers Real
Performance |
| Timeline |
| Okta Inc |
| Cohen Steers Real |
Okta and Cohen Steers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Okta and Cohen Steers
The main advantage of trading using opposite Okta and Cohen Steers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Okta 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 Okta Inc and Cohen Steers Real 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. Invesco High Income | Cohen Steers vs. Blackrock Muniholdings Ny | Cohen Steers vs. MFS Investment Grade | Cohen Steers vs. Federated Premier Municipal |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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