Correlation Between Cohen Steers and Matthews Asia
Can any of the company-specific risk be diversified away by investing in both Cohen Steers and Matthews Asia 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 Steers and Matthews Asia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cohen Steers Prfrd and Matthews Asia Dividend, you can compare the effects of market volatilities on Cohen Steers and Matthews Asia 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 Steers with a short position of Matthews Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cohen Steers and Matthews Asia.
Diversification Opportunities for Cohen Steers and Matthews Asia
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Cohen and Matthews is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Cohen Steers Prfrd and Matthews Asia Dividend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Matthews Asia Dividend and Cohen Steers 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 Steers Prfrd are associated (or correlated) with Matthews Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Matthews Asia Dividend has no effect on the direction of Cohen Steers i.e., Cohen Steers and Matthews Asia go up and down completely randomly.
Pair Corralation between Cohen Steers and Matthews Asia
Assuming the 90 days horizon Cohen Steers Prfrd is expected to generate 0.16 times more return on investment than Matthews Asia. However, Cohen Steers Prfrd is 6.21 times less risky than Matthews Asia. It trades about 0.14 of its potential returns per unit of risk. Matthews Asia Dividend is currently generating about 0.01 per unit of risk. If you would invest 1,229 in Cohen Steers Prfrd on September 12, 2024 and sell it today you would earn a total of 16.00 from holding Cohen Steers Prfrd or generate 1.3% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 98.44% |
Values | Daily Returns |
Cohen Steers Prfrd vs. Matthews Asia Dividend
Performance |
Timeline |
Cohen Steers Prfrd |
Matthews Asia Dividend |
Cohen Steers and Matthews Asia Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Cohen Steers and Matthews Asia
The main advantage of trading using opposite Cohen Steers and Matthews Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cohen Steers position performs unexpectedly, Matthews Asia 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 Matthews Asia will offset losses from the drop in Matthews Asia's long position.Cohen Steers vs. John Hancock Financial | Cohen Steers vs. 1919 Financial Services | Cohen Steers vs. Angel Oak Financial | Cohen Steers vs. Fidelity Advisor Financial |
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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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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