Correlation Between Nuveen Kansas and Nuveen Nebraska
Can any of the company-specific risk be diversified away by investing in both Nuveen Kansas and Nuveen Nebraska 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 Kansas and Nuveen Nebraska into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nuveen Kansas Municipal and Nuveen Nebraska Municipal, you can compare the effects of market volatilities on Nuveen Kansas and Nuveen Nebraska 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 Kansas with a short position of Nuveen Nebraska. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Kansas and Nuveen Nebraska.
Diversification Opportunities for Nuveen Kansas and Nuveen Nebraska
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Nuveen and Nuveen is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Kansas Municipal and Nuveen Nebraska Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Nebraska Municipal and Nuveen Kansas 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 Kansas Municipal are associated (or correlated) with Nuveen Nebraska. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Nebraska Municipal has no effect on the direction of Nuveen Kansas i.e., Nuveen Kansas and Nuveen Nebraska go up and down completely randomly.
Pair Corralation between Nuveen Kansas and Nuveen Nebraska
Assuming the 90 days horizon Nuveen Kansas is expected to generate 1.17 times less return on investment than Nuveen Nebraska. But when comparing it to its historical volatility, Nuveen Kansas Municipal is 1.28 times less risky than Nuveen Nebraska. It trades about 0.49 of its potential returns per unit of risk. Nuveen Nebraska Municipal is currently generating about 0.45 of returns per unit of risk over similar time horizon. If you would invest 979.00 in Nuveen Nebraska Municipal on September 12, 2024 and sell it today you would earn a total of 16.00 from holding Nuveen Nebraska Municipal or generate 1.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nuveen Kansas Municipal vs. Nuveen Nebraska Municipal
Performance |
| Timeline |
| Nuveen Kansas Municipal |
| Nuveen Nebraska Municipal |
Nuveen Kansas and Nuveen Nebraska Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nuveen Kansas and Nuveen Nebraska
The main advantage of trading using opposite Nuveen Kansas and Nuveen Nebraska positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuveen Kansas position performs unexpectedly, Nuveen Nebraska 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 Nebraska will offset losses from the drop in Nuveen Nebraska's long position.| Nuveen Kansas vs. Goldman Sachs Government | Nuveen Kansas vs. Sit Government Securities | Nuveen Kansas vs. Dunham Porategovernment Bond | Nuveen Kansas vs. Prudential Government Income |
| Nuveen Nebraska vs. Nuveen Symphony Floating | Nuveen Nebraska vs. Nuveen Dow 30 | Nuveen Nebraska vs. Nuveen Symphony Floating | Nuveen Nebraska vs. Nuveen Symphony Floating |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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