Correlation Between Nuveen Minnesota and Aqr Diversified
Can any of the company-specific risk be diversified away by investing in both Nuveen Minnesota and Aqr Diversified 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 Minnesota and Aqr Diversified into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nuveen Minnesota Municipal and Aqr Diversified Arbitrage, you can compare the effects of market volatilities on Nuveen Minnesota and Aqr Diversified 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 Minnesota with a short position of Aqr Diversified. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Minnesota and Aqr Diversified.
Diversification Opportunities for Nuveen Minnesota and Aqr Diversified
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Nuveen and Aqr is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Minnesota Municipal and Aqr Diversified Arbitrage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aqr Diversified Arbitrage and Nuveen Minnesota 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 Minnesota Municipal are associated (or correlated) with Aqr Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aqr Diversified Arbitrage has no effect on the direction of Nuveen Minnesota i.e., Nuveen Minnesota and Aqr Diversified go up and down completely randomly.
Pair Corralation between Nuveen Minnesota and Aqr Diversified
Assuming the 90 days horizon Nuveen Minnesota Municipal is expected to generate 1.6 times more return on investment than Aqr Diversified. However, Nuveen Minnesota is 1.6 times more volatile than Aqr Diversified Arbitrage. It trades about 0.18 of its potential returns per unit of risk. Aqr Diversified Arbitrage is currently generating about -0.16 per unit of risk. If you would invest 1,075 in Nuveen Minnesota Municipal on August 31, 2024 and sell it today you would earn a total of 13.00 from holding Nuveen Minnesota Municipal or generate 1.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nuveen Minnesota Municipal vs. Aqr Diversified Arbitrage
Performance |
| Timeline |
| Nuveen Minnesota Mun |
| Aqr Diversified Arbitrage |
Nuveen Minnesota and Aqr Diversified Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nuveen Minnesota and Aqr Diversified
The main advantage of trading using opposite Nuveen Minnesota and Aqr Diversified positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuveen Minnesota position performs unexpectedly, Aqr Diversified 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 Aqr Diversified will offset losses from the drop in Aqr Diversified's long position.| Nuveen Minnesota vs. Deutsche Health And | Nuveen Minnesota vs. Tekla Healthcare Opportunities | Nuveen Minnesota vs. Baillie Gifford Health | Nuveen Minnesota vs. Highland Longshort Healthcare |
| Aqr Diversified vs. Nuveen Minnesota Municipal | Aqr Diversified vs. T Rowe Price | Aqr Diversified vs. Federated Ohio Municipal | Aqr Diversified vs. Pace Municipal Fixed |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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