Correlation Between Nuveen Minnesota and Nuveen Strategic
Can any of the company-specific risk be diversified away by investing in both Nuveen Minnesota and Nuveen Strategic 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 Nuveen Minnesota and Nuveen Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nuveen Minnesota Intermediate and Nuveen Strategic Municipal, you can compare the effects of market volatilities on Nuveen Minnesota and Nuveen Strategic 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 Nuveen Minnesota with a short position of Nuveen Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Minnesota and Nuveen Strategic.
Diversification Opportunities for Nuveen Minnesota and Nuveen Strategic
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Nuveen and Nuveen is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Minnesota Intermediate and Nuveen Strategic Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Strategic Mun and Nuveen Minnesota 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 Nuveen Minnesota Intermediate are associated (or correlated) with Nuveen Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Strategic Mun has no effect on the direction of Nuveen Minnesota i.e., Nuveen Minnesota and Nuveen Strategic go up and down completely randomly.
Pair Corralation between Nuveen Minnesota and Nuveen Strategic
Assuming the 90 days horizon Nuveen Minnesota Intermediate is expected to generate 0.81 times more return on investment than Nuveen Strategic. However, Nuveen Minnesota Intermediate is 1.23 times less risky than Nuveen Strategic. It trades about -0.3 of its potential returns per unit of risk. Nuveen Strategic Municipal is currently generating about -0.33 per unit of risk. If you would invest 982.00 in Nuveen Minnesota Intermediate on October 10, 2024 and sell it today you would lose (12.00) from holding Nuveen Minnesota Intermediate or give up 1.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nuveen Minnesota Intermediate vs. Nuveen Strategic Municipal
Performance |
| Timeline |
| Nuveen Minnesota Int |
| Nuveen Strategic Mun |
Nuveen Minnesota and Nuveen Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nuveen Minnesota and Nuveen Strategic
The main advantage of trading using opposite Nuveen Minnesota and Nuveen Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuveen Minnesota position performs unexpectedly, Nuveen Strategic 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 Strategic will offset losses from the drop in Nuveen Strategic's long position.| Nuveen Minnesota vs. Nuveen Small Cap | Nuveen Minnesota vs. Nuveen Real Estate | Nuveen Minnesota vs. Nuveen Real Estate | Nuveen Minnesota vs. Nuveen Preferred Securities |
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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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