Correlation Between Bruce Fund and Nuveen Kansas
Can any of the company-specific risk be diversified away by investing in both Bruce Fund and Nuveen Kansas 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 Bruce Fund and Nuveen Kansas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bruce Fund Bruce and Nuveen Kansas Municipal, you can compare the effects of market volatilities on Bruce Fund and Nuveen Kansas 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 Bruce Fund with a short position of Nuveen Kansas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bruce Fund and Nuveen Kansas.
Diversification Opportunities for Bruce Fund and Nuveen Kansas
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bruce and Nuveen is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Bruce Fund Bruce and Nuveen Kansas Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Kansas Municipal and Bruce Fund 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 Bruce Fund Bruce are associated (or correlated) with Nuveen Kansas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Kansas Municipal has no effect on the direction of Bruce Fund i.e., Bruce Fund and Nuveen Kansas go up and down completely randomly.
Pair Corralation between Bruce Fund and Nuveen Kansas
Assuming the 90 days horizon Bruce Fund Bruce is expected to generate 3.01 times more return on investment than Nuveen Kansas. However, Bruce Fund is 3.01 times more volatile than Nuveen Kansas Municipal. It trades about 0.19 of its potential returns per unit of risk. Nuveen Kansas Municipal is currently generating about 0.13 per unit of risk. If you would invest 49,886 in Bruce Fund Bruce on December 2, 2024 and sell it today you would earn a total of 2,213 from holding Bruce Fund Bruce or generate 4.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bruce Fund Bruce vs. Nuveen Kansas Municipal
Performance |
| Timeline |
| Bruce Fund Bruce |
| Nuveen Kansas Municipal |
Bruce Fund and Nuveen Kansas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bruce Fund and Nuveen Kansas
The main advantage of trading using opposite Bruce Fund and Nuveen Kansas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bruce Fund position performs unexpectedly, Nuveen Kansas 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 Kansas will offset losses from the drop in Nuveen Kansas' long position.| Bruce Fund vs. Schwab Health Care | ||
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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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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