Correlation Between Cohn Steers and Diamond Hill

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Can any of the company-specific risk be diversified away by investing in both Cohn Steers and Diamond Hill 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 Cohn Steers and Diamond Hill into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cohn Steers and Diamond Hill Inv, you can compare the effects of market volatilities on Cohn Steers and Diamond Hill 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 Cohn Steers with a short position of Diamond Hill. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cohn Steers and Diamond Hill.

Diversification Opportunities for Cohn Steers and Diamond Hill

0.65
  Correlation Coefficient

Poor diversification

The 3 months correlation between Cohn Steers and Diamond is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Cohn Steers and Diamond Hill Inv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Diamond Hill Inv and Cohn 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 Cohn Steers are associated (or correlated) with Diamond Hill. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Diamond Hill Inv has no effect on the direction of Cohn Steers i.e., Cohn Steers and Diamond Hill go up and down completely randomly.

Pair Corralation between Cohn Steers and Diamond Hill

Considering the 90-day investment horizon Cohn Steers is expected to generate 4.08 times less return on investment than Diamond Hill. In addition to that, Cohn Steers is 1.04 times more volatile than Diamond Hill Inv. It trades about 0.02 of its total potential returns per unit of risk. Diamond Hill Inv is currently generating about 0.08 per unit of volatility. If you would invest  9,696  in Diamond Hill Inv on April 4, 2022 and sell it today you would earn a total of  7,891  from holding Diamond Hill Inv or generate 81.38% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Cohn Steers  vs.  Diamond Hill Inv

 Performance (%) 
      Timeline 
Cohn Steers 
Cohn Steers Performance
0 of 100
Over the last 90 days Cohn Steers has generated negative risk-adjusted returns adding no value to investors with long positions. Even with uncertain performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in August 2022. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Structure and Payout Changes

Forward Annual Dividend Yield
0.0338
Payout Ratio
0.76
Forward Annual Dividend Rate
2.2
Dividend Date
2022-05-26
Ex Dividend Date
2022-05-13

Cohn Steers Price Channel

Diamond Hill Inv 
Diamond Performance
0 of 100
Over the last 90 days Diamond Hill Inv has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively steady forward indicators, Diamond Hill is not utilizing all of its potentials. The newest stock price chaos, may contribute to medium-term losses for the stakeholders.

Structure and Payout Changes

Forward Annual Dividend Yield
0.0341
Payout Ratio
0.98
Last Split Factor
1:5
Forward Annual Dividend Rate
6.0
Dividend Date
2022-06-17
Ex Dividend Date
2022-06-01
Last Split Date
2001-09-26

Diamond Price Channel

Cohn Steers and Diamond Hill Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Cohn Steers and Diamond Hill

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

Cohn Steers

Pair trading matchups for Cohn Steers

The idea behind Cohn Steers and Diamond Hill Inv 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.

Diamond Hill Inv

Pair trading matchups for Diamond Hill

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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.

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