Correlation Between Cohen Steers and Europacific Growth
Can any of the company-specific risk be diversified away by investing in both Cohen Steers and Europacific Growth 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 Europacific Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cohen Steers Infrastructure and Europacific Growth Fund, you can compare the effects of market volatilities on Cohen Steers and Europacific Growth 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 Europacific Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cohen Steers and Europacific Growth.
Diversification Opportunities for Cohen Steers and Europacific Growth
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Cohen and Europacific is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Cohen Steers Infrastructure and Europacific Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Europacific Growth 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 Infrastructure are associated (or correlated) with Europacific Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Europacific Growth has no effect on the direction of Cohen Steers i.e., Cohen Steers and Europacific Growth go up and down completely randomly.
Pair Corralation between Cohen Steers and Europacific Growth
Assuming the 90 days horizon Cohen Steers Infrastructure is expected to generate 1.27 times more return on investment than Europacific Growth. However, Cohen Steers is 1.27 times more volatile than Europacific Growth Fund. It trades about 0.02 of its potential returns per unit of risk. Europacific Growth Fund is currently generating about -0.03 per unit of risk. If you would invest 2,213 in Cohen Steers Infrastructure on January 24, 2024 and sell it today you would earn a total of 14.00 from holding Cohen Steers Infrastructure or generate 0.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cohen Steers Infrastructure vs. Europacific Growth Fund
Performance |
| Timeline |
| Cohen Steers Infrast |
| Europacific Growth |
Cohen Steers and Europacific Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cohen Steers and Europacific Growth
The main advantage of trading using opposite Cohen Steers and Europacific Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cohen Steers position performs unexpectedly, Europacific Growth 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 Europacific Growth will offset losses from the drop in Europacific Growth's long position.| Cohen Steers vs. Vanguard Total Stock | Cohen Steers vs. Vanguard 500 Index | Cohen Steers vs. Vanguard Total Stock | Cohen Steers vs. Vanguard Total Stock |
| Europacific Growth vs. Income Fund Of | Europacific Growth vs. New World Fund | Europacific Growth vs. American Mutual Fund | Europacific Growth vs. American Mutual Fund |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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