Correlation Between Pimco Capital and Cohen Steers

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

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

Diversification Opportunities for Pimco Capital and Cohen Steers

0.94

Correlation Coefficient

Pimco Capital  Cohen Steers

Almost no diversification

The 3 months correlation between Pimco and Cohen is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Pimco Capital Sec and Cohen Steers Prfrd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cohen Steers Prfrd and Pimco Capital 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 Pimco Capital Sec 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 Prfrd has no effect on the direction of Pimco Capital i.e., Pimco Capital and Cohen Steers go up and down completely randomly.

Pair Corralation between Pimco Capital and Cohen Steers

Assuming the 90 days horizon Pimco Capital Sec is expected to under-perform the Cohen Steers. But the mutual fund apears to be less risky and, when comparing its historical volatility, Pimco Capital Sec is 1.29 times less risky than Cohen Steers. The mutual fund trades about -0.03 of its potential returns per unit of risk. The Cohen Steers Prfrd is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  1,229  in Cohen Steers Prfrd on October 20, 2024 and sell it today you would earn a total of  2.00  from holding Cohen Steers Prfrd or generate 0.16% return on investment over 90 days.

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

Pimco Capital Sec  vs.  Cohen Steers Prfrd

Pimco Capital Sec

Risk-Adjusted Performance

0 of 100

Very Weak

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

Cohen Steers Prfrd

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cohen Steers Prfrd 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 Pimco Capital and Cohen Steers

The main advantage of trading using opposite Pimco Capital and Cohen Steers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco Capital 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 Pimco Capital Sec and Cohen Steers Prfrd 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.