Correlation Between Cohen and Lmp Capital
Can any of the company-specific risk be diversified away by investing in both Cohen and Lmp Capital 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 and Lmp Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cohen And Steers and Lmp Capital And, you can compare the effects of market volatilities on Cohen and Lmp Capital 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 with a short position of Lmp Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cohen and Lmp Capital.
Diversification Opportunities for Cohen and Lmp Capital
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cohen and LMP is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Cohen And Steers and Lmp Capital And in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lmp Capital And and Cohen 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 And Steers are associated (or correlated) with Lmp Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lmp Capital And has no effect on the direction of Cohen i.e., Cohen and Lmp Capital go up and down completely randomly.
Pair Corralation between Cohen and Lmp Capital
Considering the 90-day investment horizon Cohen is expected to generate 1.73 times less return on investment than Lmp Capital. But when comparing it to its historical volatility, Cohen And Steers is 1.2 times less risky than Lmp Capital. It trades about 0.21 of its potential returns per unit of risk. Lmp Capital And is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 1,669 in Lmp Capital And on August 31, 2024 and sell it today you would earn a total of 114.00 from holding Lmp Capital And or generate 6.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cohen And Steers vs. Lmp Capital And
Performance |
| Timeline |
| Cohen And Steers |
| Lmp Capital And |
Cohen and Lmp Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cohen and Lmp Capital
The main advantage of trading using opposite Cohen and Lmp Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cohen position performs unexpectedly, Lmp Capital 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 Lmp Capital will offset losses from the drop in Lmp Capital's long position.| Cohen vs. MFS Investment Grade | Cohen vs. Eaton Vance Municipal | Cohen vs. DTF Tax Free | Cohen vs. HUMANA INC |
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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