Correlation Between Jennison Natural and Cohen Steers
Can any of the company-specific risk be diversified away by investing in both Jennison Natural 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 Jennison Natural and Cohen Steers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jennison Natural Resources and Cohen Steers Preferred, you can compare the effects of market volatilities on Jennison Natural 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 Jennison Natural with a short position of Cohen Steers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jennison Natural and Cohen Steers.
Diversification Opportunities for Jennison Natural and Cohen Steers
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jennison and Cohen is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Jennison Natural Resources and Cohen Steers Preferred in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cohen Steers Preferred and Jennison Natural 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 Jennison Natural Resources 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 Preferred has no effect on the direction of Jennison Natural i.e., Jennison Natural and Cohen Steers go up and down completely randomly.
Pair Corralation between Jennison Natural and Cohen Steers
Assuming the 90 days horizon Jennison Natural Resources is expected to under-perform the Cohen Steers. In addition to that, Jennison Natural is 8.3 times more volatile than Cohen Steers Preferred. It trades about -0.02 of its total potential returns per unit of risk. Cohen Steers Preferred is currently generating about 0.26 per unit of volatility. If you would invest 1,178 in Cohen Steers Preferred on September 1, 2024 and sell it today you would earn a total of 61.00 from holding Cohen Steers Preferred or generate 5.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Jennison Natural Resources vs. Cohen Steers Preferred
Performance |
| Timeline |
| Jennison Natural Res |
| Cohen Steers Preferred |
Jennison Natural and Cohen Steers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jennison Natural and Cohen Steers
The main advantage of trading using opposite Jennison Natural and Cohen Steers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jennison Natural 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.| Jennison Natural vs. Virtus Convertible | Jennison Natural vs. Absolute Convertible Arbitrage | Jennison Natural vs. Gabelli Convertible And | Jennison Natural vs. Advent Claymore Convertible |
| Cohen Steers vs. Dreyfusstandish Global Fixed | Cohen Steers vs. Ft 7934 Corporate | Cohen Steers vs. Thrivent Income Fund | Cohen Steers vs. Calamos Dynamic Convertible |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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