Correlation Between Nuveen Floating and Invesco California
Can any of the company-specific risk be diversified away by investing in both Nuveen Floating and Invesco California 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 Floating and Invesco California into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nuveen Floating Rate and Invesco California Value, you can compare the effects of market volatilities on Nuveen Floating and Invesco California 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 Floating with a short position of Invesco California. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Floating and Invesco California.
Diversification Opportunities for Nuveen Floating and Invesco California
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Nuveen and Invesco is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Floating Rate and Invesco California Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco California Value and Nuveen Floating 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 Floating Rate are associated (or correlated) with Invesco California. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco California Value has no effect on the direction of Nuveen Floating i.e., Nuveen Floating and Invesco California go up and down completely randomly.
Pair Corralation between Nuveen Floating and Invesco California
Considering the 90-day investment horizon Nuveen Floating Rate is expected to generate 0.95 times more return on investment than Invesco California. However, Nuveen Floating Rate is 1.06 times less risky than Invesco California. It trades about 0.13 of its potential returns per unit of risk. Invesco California Value is currently generating about 0.08 per unit of risk. If you would invest 821.00 in Nuveen Floating Rate on September 3, 2024 and sell it today you would earn a total of 91.00 from holding Nuveen Floating Rate or generate 11.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nuveen Floating Rate vs. Invesco California Value
Performance |
| Timeline |
| Nuveen Floating Rate |
| Invesco California Value |
Nuveen Floating and Invesco California Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nuveen Floating and Invesco California
The main advantage of trading using opposite Nuveen Floating and Invesco California positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuveen Floating position performs unexpectedly, Invesco California 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 Invesco California will offset losses from the drop in Invesco California's long position.| Nuveen Floating vs. Pioneer Floating Rate | Nuveen Floating vs. BlackRock Floating Rate | Nuveen Floating vs. Blackrock Muni Intermediate | Nuveen Floating vs. Eaton Vance Senior |
| Invesco California vs. Pimco California Municipal | Invesco California vs. Invesco Pennsylvania Value | Invesco California vs. Nuveen California Dividend | Invesco California vs. Invesco Advantage MIT |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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