Correlation Between Rbc Bluebay and Cohen Steers

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

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

Diversification Opportunities for Rbc Bluebay and Cohen Steers

0.87

Correlation Coefficient

Rbc Bluebay  Cohen Steers

Very poor diversification

The 3 months correlation between Rbc and Cohen is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Rbc Bluebay Global 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 Rbc Bluebay 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 Rbc Bluebay Global 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 Rbc Bluebay i.e., Rbc Bluebay and Cohen Steers go up and down completely randomly.

Pair Corralation between Rbc Bluebay and Cohen Steers

Assuming the 90 days horizon Rbc Bluebay Global is expected to generate 1.02 times more return on investment than Cohen Steers. However, Rbc Bluebay is 1.02 times more volatile than Cohen Steers Prfrd. It trades about 0.13 of its potential returns per unit of risk. Cohen Steers Prfrd is currently generating about 0.12 per unit of risk. If you would invest  959.00  in Rbc Bluebay Global on December 20, 2024 and sell it today you would earn a total of  13.00  from holding Rbc Bluebay Global or generate 1.36% return on investment over 90 days.

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

Rbc Bluebay Global  vs.  Cohen Steers Prfrd

Rbc Bluebay Global

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Rbc Bluebay Global are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Rbc Bluebay 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

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Cohen Steers Prfrd are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. 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 Rbc Bluebay and Cohen Steers

The main advantage of trading using opposite Rbc Bluebay and Cohen Steers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rbc Bluebay 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 Rbc Bluebay Global 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.