Correlation Between VICI Properties and Cohen Steers

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

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

Diversification Opportunities for VICI Properties and Cohen Steers

0.88

Correlation Coefficient

VICI Properties  Cohen Steers

Very poor diversification

The 3 months correlation between VICI and Cohen is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding VICI Properties 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 VICI Properties 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 VICI Properties 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 VICI Properties i.e., VICI Properties and Cohen Steers go up and down completely randomly.

Pair Corralation between VICI Properties and Cohen Steers

Given the investment horizon of 90 days VICI Properties is expected to under-perform the Cohen Steers. In addition to that, VICI Properties is 1.05 times more volatile than Cohen Steers Real. It trades about -0.11 of its total potential returns per unit of risk. Cohen Steers Real is currently generating about -0.1 per unit of volatility. If you would invest  1,910  in Cohen Steers Real on September 17, 2024 and sell it today you would lose (106.00) from holding Cohen Steers Real or give up 5.55% of portfolio value over 90 days.

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

VICI Properties  vs.  Cohen Steers Real

VICI Properties

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days VICI Properties has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's fundamental indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

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 VICI Properties and Cohen Steers

The main advantage of trading using opposite VICI Properties and Cohen Steers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VICI Properties 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 VICI Properties 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.