Correlation Between Nuveen Arizona and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both Nuveen Arizona and Eaton Vance 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 Arizona and Eaton Vance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nuveen Arizona Municipal and Eaton Vance Minnesota, you can compare the effects of market volatilities on Nuveen Arizona and Eaton Vance 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 Arizona with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Arizona and Eaton Vance.
Diversification Opportunities for Nuveen Arizona and Eaton Vance
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Nuveen and Eaton is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Arizona Municipal and Eaton Vance Minnesota in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Minnesota and Nuveen Arizona 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 Arizona Municipal are associated (or correlated) with Eaton Vance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eaton Vance Minnesota has no effect on the direction of Nuveen Arizona i.e., Nuveen Arizona and Eaton Vance go up and down completely randomly.
Pair Corralation between Nuveen Arizona and Eaton Vance
Assuming the 90 days horizon Nuveen Arizona Municipal is expected to generate 0.95 times more return on investment than Eaton Vance. However, Nuveen Arizona Municipal is 1.05 times less risky than Eaton Vance. It trades about 0.11 of its potential returns per unit of risk. Eaton Vance Minnesota is currently generating about 0.08 per unit of risk. If you would invest 976.00 in Nuveen Arizona Municipal on September 4, 2024 and sell it today you would earn a total of 53.00 from holding Nuveen Arizona Municipal or generate 5.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nuveen Arizona Municipal vs. Eaton Vance Minnesota
Performance |
| Timeline |
| Nuveen Arizona Municipal |
| Eaton Vance Minnesota |
Nuveen Arizona and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nuveen Arizona and Eaton Vance
The main advantage of trading using opposite Nuveen Arizona and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuveen Arizona position performs unexpectedly, Eaton Vance 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 Eaton Vance will offset losses from the drop in Eaton Vance's long position.| Nuveen Arizona vs. Prudential High Yield | Nuveen Arizona vs. Alpine High Yield | Nuveen Arizona vs. Gmo High Yield | Nuveen Arizona vs. T Rowe Price |
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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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