Correlation Between Nuveen Strategic and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Nuveen Strategic and Dow Jones 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 Strategic and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nuveen Strategic Income and Dow Jones Industrial, you can compare the effects of market volatilities on Nuveen Strategic and Dow Jones 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 Strategic with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Strategic and Dow Jones.
Diversification Opportunities for Nuveen Strategic and Dow Jones
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nuveen and Dow is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Strategic Income and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial and Nuveen Strategic 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 Strategic Income are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of Nuveen Strategic i.e., Nuveen Strategic and Dow Jones go up and down completely randomly.
Pair Corralation between Nuveen Strategic and Dow Jones
Assuming the 90 days horizon Nuveen Strategic is expected to generate 6.85 times less return on investment than Dow Jones. But when comparing it to its historical volatility, Nuveen Strategic Income is 3.84 times less risky than Dow Jones. It trades about 0.15 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 4,223,305 in Dow Jones Industrial on August 30, 2024 and sell it today you would earn a total of 248,901 from holding Dow Jones Industrial or generate 5.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Nuveen Strategic Income vs. Dow Jones Industrial
Performance |
| Timeline |
Nuveen Strategic and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Nuveen Strategic Income
Pair trading matchups for Nuveen Strategic
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Nuveen Strategic and Dow Jones
The main advantage of trading using opposite Nuveen Strategic and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuveen Strategic position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| Nuveen Strategic vs. Ultra Short Fixed Income | Nuveen Strategic vs. Blrc Sgy Mnp | Nuveen Strategic vs. Icon Bond Fund | Nuveen Strategic vs. Ambrus Core Bond |
| Dow Jones vs. Skillful Craftsman Education | Dow Jones vs. Acco Brands | Dow Jones vs. Cracker Barrel Old | Dow Jones vs. Coursera |
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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |