Correlation Between Advent Claymore and Nuveen Senior
Can any of the company-specific risk be diversified away by investing in both Advent Claymore and Nuveen Senior 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 Advent Claymore and Nuveen Senior into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Advent Claymore Convertible and Nuveen Senior Income, you can compare the effects of market volatilities on Advent Claymore and Nuveen Senior 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 Advent Claymore with a short position of Nuveen Senior. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advent Claymore and Nuveen Senior.
Diversification Opportunities for Advent Claymore and Nuveen Senior
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Advent and Nuveen is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Advent Claymore Convertible and Nuveen Senior Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Senior Income and Advent Claymore 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 Advent Claymore Convertible are associated (or correlated) with Nuveen Senior. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Senior Income has no effect on the direction of Advent Claymore i.e., Advent Claymore and Nuveen Senior go up and down completely randomly.
Pair Corralation between Advent Claymore and Nuveen Senior
Considering the 90-day investment horizon Advent Claymore Convertible is expected to generate 1.86 times more return on investment than Nuveen Senior. However, Advent Claymore is 1.86 times more volatile than Nuveen Senior Income. It trades about 0.09 of its potential returns per unit of risk. Nuveen Senior Income is currently generating about 0.14 per unit of risk. If you would invest 905.00 in Advent Claymore Convertible on August 31, 2024 and sell it today you would earn a total of 313.00 from holding Advent Claymore Convertible or generate 34.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 8.56% |
| Values | Daily Returns |
Advent Claymore Convertible vs. Nuveen Senior Income
Performance |
| Timeline |
| Advent Claymore Conv |
| Nuveen Senior Income |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Advent Claymore and Nuveen Senior Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advent Claymore and Nuveen Senior
The main advantage of trading using opposite Advent Claymore and Nuveen Senior positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advent Claymore position performs unexpectedly, Nuveen Senior 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 Nuveen Senior will offset losses from the drop in Nuveen Senior's long position.| Advent Claymore vs. MFS Investment Grade | Advent Claymore vs. Eaton Vance Municipal | Advent Claymore vs. DTF Tax Free | Advent Claymore vs. HUMANA INC |
| Nuveen Senior vs. Nuveen Floating Rate | Nuveen Senior vs. Pioneer Floating Rate | Nuveen Senior vs. BlackRock Floating Rate | Nuveen Senior vs. Blackrock Floating Rate |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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