Correlation Between Cohen Dev and MetLife
Can any of the company-specific risk be diversified away by investing in both Cohen Dev and MetLife 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 Dev and MetLife into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cohen Dev and MetLife, you can compare the effects of market volatilities on Cohen Dev and MetLife 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 Dev with a short position of MetLife. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cohen Dev and MetLife.
Diversification Opportunities for Cohen Dev and MetLife
Very good diversification
The 3 months correlation between Cohen and MetLife is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Cohen Dev and MetLife in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MetLife and Cohen Dev 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 Dev are associated (or correlated) with MetLife. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MetLife has no effect on the direction of Cohen Dev i.e., Cohen Dev and MetLife go up and down completely randomly.
Pair Corralation between Cohen Dev and MetLife
Assuming the 90 days trading horizon Cohen Dev is expected to under-perform the MetLife. In addition to that, Cohen Dev is 1.91 times more volatile than MetLife. It trades about -0.02 of its total potential returns per unit of risk. MetLife is currently generating about 0.04 per unit of volatility. If you would invest 7,134 in MetLife on February 13, 2024 and sell it today you would earn a total of 109.00 from holding MetLife or generate 1.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 73.81% |
| Values | Daily Returns |
Cohen Dev vs. MetLife
Performance |
| Timeline |
| Cohen Dev |
| MetLife |
Cohen Dev and MetLife Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cohen Dev and MetLife
The main advantage of trading using opposite Cohen Dev and MetLife positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cohen Dev position performs unexpectedly, MetLife 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 MetLife will offset losses from the drop in MetLife's long position.| Cohen Dev vs. Fattal 1998 Holdings | Cohen Dev vs. El Al Israel | Cohen Dev vs. Bank Leumi Le Israel | Cohen Dev vs. Teva Pharmaceutical Industries |
| MetLife vs. Lincoln National | MetLife vs. Aflac Incorporated | MetLife vs. Unum Group | MetLife vs. Manulife Financial Corp |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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