Correlation Between Nuveen Louisiana and Ab Global
Can any of the company-specific risk be diversified away by investing in both Nuveen Louisiana and Ab Global 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 Louisiana and Ab Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nuveen Louisiana Municipal and Ab Global Bond, you can compare the effects of market volatilities on Nuveen Louisiana and Ab Global 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 Louisiana with a short position of Ab Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Louisiana and Ab Global.
Diversification Opportunities for Nuveen Louisiana and Ab Global
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Nuveen and ANAGX is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Louisiana Municipal and Ab Global Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab Global Bond and Nuveen Louisiana 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 Louisiana Municipal are associated (or correlated) with Ab Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab Global Bond has no effect on the direction of Nuveen Louisiana i.e., Nuveen Louisiana and Ab Global go up and down completely randomly.
Pair Corralation between Nuveen Louisiana and Ab Global
Assuming the 90 days horizon Nuveen Louisiana Municipal is expected to generate 0.84 times more return on investment than Ab Global. However, Nuveen Louisiana Municipal is 1.19 times less risky than Ab Global. It trades about 0.07 of its potential returns per unit of risk. Ab Global Bond is currently generating about 0.06 per unit of risk. If you would invest 989.00 in Nuveen Louisiana Municipal on September 4, 2024 and sell it today you would earn a total of 86.00 from holding Nuveen Louisiana Municipal or generate 8.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nuveen Louisiana Municipal vs. Ab Global Bond
Performance |
| Timeline |
| Nuveen Louisiana Mun |
| Ab Global Bond |
Nuveen Louisiana and Ab Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nuveen Louisiana and Ab Global
The main advantage of trading using opposite Nuveen Louisiana and Ab Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuveen Louisiana position performs unexpectedly, Ab Global 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 Ab Global will offset losses from the drop in Ab Global's long position.| Nuveen Louisiana vs. Ab Global Bond | Nuveen Louisiana vs. Morningstar Global Income | Nuveen Louisiana vs. Nationwide Global Equity | Nuveen Louisiana vs. Legg Mason Global |
| Ab Global vs. Lord Abbett Convertible | Ab Global vs. Virtus Convertible | Ab Global vs. Rationalpier 88 Convertible | Ab Global vs. Advent Claymore Convertible |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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