Correlation Between Champlain Mid and Cohen Steers

Can any of the company-specific risk be diversified away by investing in both Champlain Mid 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 Champlain Mid and Cohen Steers into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Champlain Mid Cap and Cohen Steers Preferred, you can compare the effects of market volatilities on Champlain Mid 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 Champlain Mid with a short position of Cohen Steers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Champlain Mid and Cohen Steers.

Diversification Opportunities for Champlain Mid and Cohen Steers

0.37

Correlation Coefficient

Champlain Mid  Cohen Steers

Weak diversification

The 3 months correlation between Champlain and Cohen is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Champlain Mid Cap 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 Champlain Mid 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 Champlain Mid Cap 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 Champlain Mid i.e., Champlain Mid and Cohen Steers go up and down completely randomly.

Pair Corralation between Champlain Mid and Cohen Steers

Assuming the 90 days horizon Champlain Mid Cap is expected to generate 5.35 times more return on investment than Cohen Steers. However, Champlain Mid is 5.35 times more volatile than Cohen Steers Preferred. It trades about 0.21 of its potential returns per unit of risk. Cohen Steers Preferred is currently generating about 0.14 per unit of risk. If you would invest  2,354  in Champlain Mid Cap on September 4, 2024 and sell it today you would earn a total of  264.00  from holding Champlain Mid Cap or generate 11.21% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

Champlain Mid Cap  vs.  Cohen Steers Preferred

Champlain Mid Cap

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Champlain Mid Cap are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak primary indicators, Champlain Mid may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Cohen Steers Preferred

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Cohen Steers Preferred are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Cohen Steers is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Champlain Mid and Cohen Steers

The main advantage of trading using opposite Champlain Mid and Cohen Steers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Champlain Mid 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 Champlain Mid Cap and Cohen Steers Preferred 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.

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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.