Correlation Between Cohen Steers and Morgan Stanley
Can any of the company-specific risk be diversified away by investing in both Cohen Steers and Morgan Stanley 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 Cohen Steers and Morgan Stanley into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cohen Steers Real and Morgan Stanley Emerging, you can compare the effects of market volatilities on Cohen Steers and Morgan Stanley 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 Cohen Steers with a short position of Morgan Stanley. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cohen Steers and Morgan Stanley.
Diversification Opportunities for Cohen Steers and Morgan Stanley
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Cohen and Morgan is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Cohen Steers Real and Morgan Stanley Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Morgan Stanley Emerging and Cohen Steers 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 Cohen Steers Real are associated (or correlated) with Morgan Stanley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Morgan Stanley Emerging has no effect on the direction of Cohen Steers i.e., Cohen Steers and Morgan Stanley go up and down completely randomly.
Pair Corralation between Cohen Steers and Morgan Stanley
Assuming the 90 days horizon Cohen Steers is expected to generate 1.18 times less return on investment than Morgan Stanley. In addition to that, Cohen Steers is 2.06 times more volatile than Morgan Stanley Emerging. It trades about 0.12 of its total potential returns per unit of risk. Morgan Stanley Emerging is currently generating about 0.28 per unit of volatility. If you would invest 510.00 in Morgan Stanley Emerging on April 15, 2025 and sell it today you would earn a total of 37.00 from holding Morgan Stanley Emerging or generate 7.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cohen Steers Real vs. Morgan Stanley Emerging
Performance |
| Timeline |
| Cohen Steers Real |
| Morgan Stanley Emerging |
Cohen Steers and Morgan Stanley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cohen Steers and Morgan Stanley
The main advantage of trading using opposite Cohen Steers and Morgan Stanley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cohen Steers position performs unexpectedly, Morgan Stanley 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 Morgan Stanley will offset losses from the drop in Morgan Stanley's long position.| Cohen Steers vs. Fidelity Series Emerging | Cohen Steers vs. Prudential Emerging Markets | Cohen Steers vs. Transamerica Emerging Markets | Cohen Steers vs. Dreyfus Global Emerging |
| Morgan Stanley vs. Gabelli Global Financial | Morgan Stanley vs. Angel Oak Financial | Morgan Stanley vs. Davis Financial Fund | Morgan Stanley vs. John Hancock Financial |
Check out your portfolio center.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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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