Correlation Between Cohen Steers and Fmasx

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

By analyzing existing cross correlation between Cohen Steers Realty and Fmasx, you can compare the effects of market volatilities on Cohen Steers and Fmasx 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 Fmasx. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cohen Steers and Fmasx.

Diversification Opportunities for Cohen Steers and Fmasx

0.13

Correlation Coefficient

Cohen Steers  Fmasx

Average diversification

The 3 months correlation between Cohen and Fmasx is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Cohen Steers Realty and Fmasx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fmasx 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 Realty are associated (or correlated) with Fmasx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fmasx has no effect on the direction of Cohen Steers i.e., Cohen Steers and Fmasx go up and down completely randomly.

Pair Corralation between Cohen Steers and Fmasx

Assuming the 90 days horizon Cohen Steers Realty is expected to generate 0.86 times more return on investment than Fmasx. However, Cohen Steers Realty is 1.16 times less risky than Fmasx. It trades about 0.06 of its potential returns per unit of risk. Fmasx is currently generating about -0.07 per unit of risk. If you would invest  6,454  in Cohen Steers Realty on December 19, 2024 and sell it today you would earn a total of  251.00  from holding Cohen Steers Realty or generate 3.89% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Cohen Steers Realty  vs.  Fmasx

Cohen Steers Realty

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Cohen Steers Realty are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Cohen Steers is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Fmasx

Risk-Adjusted Performance

Very Weak

Over the last 90 days Fmasx has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Fmasx is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Cohen Steers and Fmasx

The main advantage of trading using opposite Cohen Steers and Fmasx positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cohen Steers position performs unexpectedly, Fmasx 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 Fmasx will offset losses from the drop in Fmasx's long position.

The idea behind Cohen Steers Realty and Fmasx 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.