Correlation Between Cohen and State Street
Can any of the company-specific risk be diversified away by investing in both Cohen and State Street 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 State Street 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 State Street Corp, you can compare the effects of market volatilities on Cohen and State Street 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 State Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cohen and State Street.
Diversification Opportunities for Cohen and State Street
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cohen and State is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Cohen And Steers and State Street Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Street Corp 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 State Street. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Street Corp has no effect on the direction of Cohen i.e., Cohen and State Street go up and down completely randomly.
Pair Corralation between Cohen and State Street
Considering the 90-day investment horizon Cohen And Steers is expected to generate 1.14 times more return on investment than State Street. However, Cohen is 1.14 times more volatile than State Street Corp. It trades about 0.1 of its potential returns per unit of risk. State Street Corp is currently generating about -0.05 per unit of risk. If you would invest 2,253 in Cohen And Steers on January 26, 2024 and sell it today you would earn a total of 65.00 from holding Cohen And Steers or generate 2.89% 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. State Street Corp
Performance |
| Timeline |
| Cohen And Steers |
| State Street Corp |
Cohen and State Street Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cohen and State Street
The main advantage of trading using opposite Cohen and State Street positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cohen position performs unexpectedly, State Street 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 State Street will offset losses from the drop in State Street's long position.The idea behind Cohen And Steers and State Street Corp 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.| State Street vs. Invesco Plc | State Street vs. Franklin Resources | State Street vs. T Rowe Price | State Street vs. SEI Investments |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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