Correlation Between Cohen Steers and Third Avenue

Can any of the company-specific risk be diversified away by investing in both Cohen Steers and Third Avenue 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 Third Avenue 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 Third Avenue Real, you can compare the effects of market volatilities on Cohen Steers and Third Avenue 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 Third Avenue. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cohen Steers and Third Avenue.

Diversification Opportunities for Cohen Steers and Third Avenue

0.0

Correlation Coefficient

Cohen Steers  Third Avenue

Pay attention - limited upside

The 3 months correlation between Cohen and Third is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cohen Steers Realty and Third Avenue Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Third Avenue Real 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 Third Avenue. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Third Avenue Real has no effect on the direction of Cohen Steers i.e., Cohen Steers and Third Avenue go up and down completely randomly.

Pair Corralation between Cohen Steers and Third Avenue

If you would invest  2,373  in Third Avenue Real on September 10, 2024 and sell it today you would earn a total of  220.00  from holding Third Avenue Real or generate 9.27% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Cohen Steers Realty  vs.  Third Avenue Real

Cohen Steers Realty

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cohen Steers Realty has generated negative risk-adjusted returns adding no value to fund investors. 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.

Third Avenue Real

Risk-Adjusted Performance

0 of 100

Good

Over the last 90 days Third Avenue Real has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly weak technical and fundamental indicators, Third Avenue may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Cohen Steers and Third Avenue

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

The idea behind Cohen Steers Realty and Third Avenue Real 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.