Correlation Between Howard Hughes and IShares Cohen

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

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

Diversification Opportunities for Howard Hughes and IShares Cohen

0.84

Correlation Coefficient

Howard Hughes  IShares Cohen

Very poor diversification

The 3 months correlation between Howard and IShares is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Howard Hughes and iShares Cohen Steers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Cohen Steers and Howard Hughes 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 Howard Hughes are associated (or correlated) with IShares Cohen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Cohen Steers has no effect on the direction of Howard Hughes i.e., Howard Hughes and IShares Cohen go up and down completely randomly.

Pair Corralation between Howard Hughes and IShares Cohen

Considering the 90-day investment horizon Howard Hughes is expected to under-perform the IShares Cohen. In addition to that, Howard Hughes is 1.56 times more volatile than iShares Cohen Steers. It trades about -0.07 of its total potential returns per unit of risk. iShares Cohen Steers is currently generating about 0.0 per unit of volatility. If you would invest  5,659  in iShares Cohen Steers on March 14, 2024 and sell it today you would lose (32.00) from holding iShares Cohen Steers or give up 0.57% of portfolio value over 90 days.

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

Howard Hughes  vs.  iShares Cohen Steers

Howard Hughes

Risk-Adjusted Performance

0 of 100

Very Weak

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

iShares Cohen Steers

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days iShares Cohen Steers has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, IShares Cohen is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Howard Hughes and IShares Cohen

The main advantage of trading using opposite Howard Hughes and IShares Cohen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Howard Hughes position performs unexpectedly, IShares Cohen 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 IShares Cohen will offset losses from the drop in IShares Cohen's long position.

The idea behind Howard Hughes and iShares Cohen Steers 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.