Correlation Between Pimco Corporate and Cohen Steers

Can any of the company-specific risk be diversified away by investing in both Pimco Corporate 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 Corporate 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 Corporate Income and Cohen Steers Reit, you can compare the effects of market volatilities on Pimco Corporate 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 Corporate with a short position of Cohen Steers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco Corporate and Cohen Steers.

Diversification Opportunities for Pimco Corporate and Cohen Steers

0.86

Correlation Coefficient

Pimco Corporate  Cohen Steers

Very poor diversification

The 3 months correlation between Pimco and Cohen is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Pimco Corporate Income and Cohen Steers Reit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cohen Steers Reit and Pimco Corporate 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 Corporate Income 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 Reit has no effect on the direction of Pimco Corporate i.e., Pimco Corporate and Cohen Steers go up and down completely randomly.

Pair Corralation between Pimco Corporate and Cohen Steers

Considering the 90-day investment horizon Pimco Corporate is expected to generate 1.49 times less return on investment than Cohen Steers. But when comparing it to its historical volatility, Pimco Corporate Income is 3.2 times less risky than Cohen Steers. It trades about 0.19 of its potential returns per unit of risk. Cohen Steers Reit is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  2,078  in Cohen Steers Reit on December 26, 2024 and sell it today you would earn a total of  92.00  from holding Cohen Steers Reit or generate 4.43% return on investment over 90 days.

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

Pimco Corporate Income  vs.  Cohen Steers Reit

Pimco Corporate Income

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Pimco Corporate Income are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Pimco Corporate is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Cohen Steers Reit

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Cohen Steers Reit are ranked lower than 6 (%) of all funds and portfolios of funds over the last 90 days. Even with relatively invariable basic indicators, Cohen Steers is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Pimco Corporate and Cohen Steers

The main advantage of trading using opposite Pimco Corporate and Cohen Steers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco Corporate 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 Corporate Income and Cohen Steers Reit 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..