Correlation Between Fidelity New and Nuveen Strategic
Can any of the company-specific risk be diversified away by investing in both Fidelity New 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 Fidelity New and Nuveen Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity New Markets and Nuveen Strategic Municipal, you can compare the effects of market volatilities on Fidelity New 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 Fidelity New with a short position of Nuveen Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity New and Nuveen Strategic.
Diversification Opportunities for Fidelity New and Nuveen Strategic
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Fidelity and Nuveen is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity New Markets 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 Fidelity New 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 Fidelity New Markets 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 Fidelity New i.e., Fidelity New and Nuveen Strategic go up and down completely randomly.
Pair Corralation between Fidelity New and Nuveen Strategic
Assuming the 90 days horizon Fidelity New Markets is expected to under-perform the Nuveen Strategic. In addition to that, Fidelity New is 1.11 times more volatile than Nuveen Strategic Municipal. It trades about -0.42 of its total potential returns per unit of risk. Nuveen Strategic Municipal is currently generating about -0.37 per unit of volatility. If you would invest 1,007 in Nuveen Strategic Municipal on October 16, 2024 and sell it today you would lose (19.00) from holding Nuveen Strategic Municipal or give up 1.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 94.74% |
| Values | Daily Returns |
Fidelity New Markets vs. Nuveen Strategic Municipal
Performance |
| Timeline |
| Fidelity New Markets |
| Nuveen Strategic Mun |
Fidelity New and Nuveen Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity New and Nuveen Strategic
The main advantage of trading using opposite Fidelity New and Nuveen Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity New 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.| Fidelity New vs. Dws Government Money | Fidelity New vs. Pace Municipal Fixed | Fidelity New vs. Blackrock Pa Muni | Fidelity New vs. Aig Government Money |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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