Correlation Between Guggenheim Risk and Cohen Steers

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

By analyzing existing cross correlation between Guggenheim Risk Managed and Cohen Steers Real, you can compare the effects of market volatilities on Guggenheim Risk and Cohen Steers 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 Guggenheim Risk with a short position of Cohen Steers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guggenheim Risk and Cohen Steers.

Diversification Opportunities for Guggenheim Risk and Cohen Steers

0.77

Correlation Coefficient

Guggenheim Risk  Cohen Steers

Poor diversification

The 3 months correlation between Guggenheim and Cohen is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Guggenheim Risk Managed and Cohen Steers Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cohen Steers Real and Guggenheim Risk 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 Guggenheim Risk Managed are associated (or correlated) with Cohen Steers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cohen Steers Real has no effect on the direction of Guggenheim Risk i.e., Guggenheim Risk and Cohen Steers go up and down completely randomly.

Pair Corralation between Guggenheim Risk and Cohen Steers

Assuming the 90 days horizon Guggenheim Risk Managed is expected to generate 0.86 times more return on investment than Cohen Steers. However, Guggenheim Risk Managed is 1.17 times less risky than Cohen Steers. It trades about -0.03 of its potential returns per unit of risk. Cohen Steers Real is currently generating about -0.09 per unit of risk. If you would invest  3,435  in Guggenheim Risk Managed on September 12, 2024 and sell it today you would lose (49.00) from holding Guggenheim Risk Managed or give up 1.43% of portfolio value over 90 days.

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

Guggenheim Risk Managed  vs.  Cohen Steers Real

Guggenheim Risk Managed

Risk-Adjusted Performance

0 of 100

Very Weak

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

Cohen Steers Real

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Guggenheim Risk and Cohen Steers

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

The idea behind Guggenheim Risk Managed and Cohen Steers 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.