Correlation Between DTF Tax and Nuveen Credit
Can any of the company-specific risk be diversified away by investing in both DTF Tax and Nuveen Credit 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 DTF Tax and Nuveen Credit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DTF Tax Free and Nuveen Credit Strategies, you can compare the effects of market volatilities on DTF Tax and Nuveen Credit 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 DTF Tax with a short position of Nuveen Credit. Check out your portfolio center. Please also check ongoing floating volatility patterns of DTF Tax and Nuveen Credit.
Diversification Opportunities for DTF Tax and Nuveen Credit
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DTF and Nuveen is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding DTF Tax Free and Nuveen Credit Strategies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Credit Strategies and DTF Tax 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 DTF Tax Free are associated (or correlated) with Nuveen Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Credit Strategies has no effect on the direction of DTF Tax i.e., DTF Tax and Nuveen Credit go up and down completely randomly.
Pair Corralation between DTF Tax and Nuveen Credit
Considering the 90-day investment horizon DTF Tax Free is expected to generate 0.27 times more return on investment than Nuveen Credit. However, DTF Tax Free is 3.67 times less risky than Nuveen Credit. It trades about 0.0 of its potential returns per unit of risk. Nuveen Credit Strategies is currently generating about -0.21 per unit of risk. If you would invest 1,123 in DTF Tax Free on January 5, 2025 and sell it today you would earn a total of 0.00 from holding DTF Tax Free or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.73% |
| Values | Daily Returns |
DTF Tax Free vs. Nuveen Credit Strategies
Performance |
| Timeline |
| DTF Tax Free |
| Nuveen Credit Strategies |
DTF Tax and Nuveen Credit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DTF Tax and Nuveen Credit
The main advantage of trading using opposite DTF Tax and Nuveen Credit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DTF Tax position performs unexpectedly, Nuveen Credit 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 Credit will offset losses from the drop in Nuveen Credit's long position.| DTF Tax vs. MFS Investment Grade | DTF Tax vs. Eaton Vance National | DTF Tax vs. MFS High Yield | DTF Tax vs. MFS Municipal Income |
| Nuveen Credit vs. Nuveen Floating Rate | Nuveen Credit vs. Eaton Vance Senior | Nuveen Credit vs. BlackRock Floating Rate | Nuveen Credit vs. Nuveen Mortgage Opportunity |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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