Correlation Between Global Real and Cohen Steers
Can any of the company-specific risk be diversified away by investing in both Global Real 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 Global Real and Cohen Steers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Real Estate and Cohen Steers Global, you can compare the effects of market volatilities on Global Real 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 Global Real with a short position of Cohen Steers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Real and Cohen Steers.
Diversification Opportunities for Global Real and Cohen Steers
1.0 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Global and Cohen is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding Global Real Estate and Cohen Steers Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cohen Steers Global and Global Real 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 Global Real Estate 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 Global has no effect on the direction of Global Real i.e., Global Real and Cohen Steers go up and down completely randomly.
Pair Corralation between Global Real and Cohen Steers
Assuming the 90 days horizon Global Real is expected to generate 5.09 times less return on investment than Cohen Steers. But when comparing it to its historical volatility, Global Real Estate is 1.01 times less risky than Cohen Steers. It trades about 0.01 of its potential returns per unit of risk. Cohen Steers Global is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 5,187 in Cohen Steers Global on November 27, 2024 and sell it today you would earn a total of 38.00 from holding Cohen Steers Global or generate 0.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Real Estate vs. Cohen Steers Global
Performance |
| Timeline |
| Global Real Estate |
| Cohen Steers Global |
Global Real and Cohen Steers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Real and Cohen Steers
The main advantage of trading using opposite Global Real and Cohen Steers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Real 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.| Global Real vs. Global Real Estate | Global Real vs. Neuberger Berman Real | Global Real vs. Texton Property | Global Real vs. Short Real Estate |
| Cohen Steers vs. Rational Strategic Allocation | Cohen Steers vs. T Rowe Price | Cohen Steers vs. Gmo Asset Allocation | Cohen Steers vs. Balanced Allocation Fund |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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