Correlation Between Nuveen Minnesota and Pimco Income
Can any of the company-specific risk be diversified away by investing in both Nuveen Minnesota and Pimco Income 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 Pimco Income 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 Pimco Income Fund, you can compare the effects of market volatilities on Nuveen Minnesota and Pimco Income 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 Pimco Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Minnesota and Pimco Income.
Diversification Opportunities for Nuveen Minnesota and Pimco Income
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nuveen and Pimco is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Minnesota Municipal and Pimco Income Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco Income 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 Pimco Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco Income has no effect on the direction of Nuveen Minnesota i.e., Nuveen Minnesota and Pimco Income go up and down completely randomly.
Pair Corralation between Nuveen Minnesota and Pimco Income
Assuming the 90 days horizon Nuveen Minnesota is expected to generate 1.28 times less return on investment than Pimco Income. But when comparing it to its historical volatility, Nuveen Minnesota Municipal is 1.03 times less risky than Pimco Income. It trades about 0.1 of its potential returns per unit of risk. Pimco Income Fund is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 1,055 in Pimco Income Fund on September 15, 2024 and sell it today you would earn a total of 5.00 from holding Pimco Income Fund or generate 0.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nuveen Minnesota Municipal vs. Pimco Income Fund
Performance |
| Timeline |
| Nuveen Minnesota Mun |
| Pimco Income |
Nuveen Minnesota and Pimco Income Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nuveen Minnesota and Pimco Income
The main advantage of trading using opposite Nuveen Minnesota and Pimco Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuveen Minnesota position performs unexpectedly, Pimco Income 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 Pimco Income will offset losses from the drop in Pimco Income's long position.| Nuveen Minnesota vs. Ab Government Exchange | Nuveen Minnesota vs. John Hancock Money | Nuveen Minnesota vs. Edward Jones Money | Nuveen Minnesota vs. Blackrock Exchange Portfolio |
| Pimco Income vs. Baird Strategic Municipal | Pimco Income vs. Franklin High Yield | Pimco Income vs. Ab Impact Municipal | Pimco Income vs. Nuveen Minnesota Municipal |
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.
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