Correlation Between Nuveen Short and State Street
Can any of the company-specific risk be diversified away by investing in both Nuveen Short and State Street 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 Short and State Street into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nuveen Short Term and State Street Target, you can compare the effects of market volatilities on Nuveen Short and State Street 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 Short with a short position of State Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Short and State Street.
Diversification Opportunities for Nuveen Short and State Street
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Nuveen and State is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Short Term and State Street Target in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Street Target and Nuveen Short 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 Short Term are associated (or correlated) with State Street. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Street Target has no effect on the direction of Nuveen Short i.e., Nuveen Short and State Street go up and down completely randomly.
Pair Corralation between Nuveen Short and State Street
Assuming the 90 days horizon Nuveen Short Term is expected to generate 0.04 times more return on investment than State Street. However, Nuveen Short Term is 24.35 times less risky than State Street. It trades about 0.24 of its potential returns per unit of risk. State Street Target is currently generating about -0.07 per unit of risk. If you would invest 980.00 in Nuveen Short Term on October 24, 2024 and sell it today you would earn a total of 3.00 from holding Nuveen Short Term or generate 0.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nuveen Short Term vs. State Street Target
Performance |
| Timeline |
| Nuveen Short Term |
| State Street Target |
Nuveen Short and State Street Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nuveen Short and State Street
The main advantage of trading using opposite Nuveen Short and State Street positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuveen Short position performs unexpectedly, State Street 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 State Street will offset losses from the drop in State Street's long position.| Nuveen Short vs. Goldman Sachs Trust | Nuveen Short vs. Icon Financial Fund | Nuveen Short vs. Financial Industries Fund | Nuveen Short vs. John Hancock Financial |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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