Correlation Between DWS Municipal and Munivest Fund
Can any of the company-specific risk be diversified away by investing in both DWS Municipal and Munivest Fund 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 DWS Municipal and Munivest Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DWS Municipal Income and Munivest Fund, you can compare the effects of market volatilities on DWS Municipal and Munivest Fund 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 DWS Municipal with a short position of Munivest Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of DWS Municipal and Munivest Fund.
Diversification Opportunities for DWS Municipal and Munivest Fund
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between DWS and Munivest is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding DWS Municipal Income and Munivest Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Munivest Fund and DWS Municipal 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 DWS Municipal Income are associated (or correlated) with Munivest Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Munivest Fund has no effect on the direction of DWS Municipal i.e., DWS Municipal and Munivest Fund go up and down completely randomly.
Pair Corralation between DWS Municipal and Munivest Fund
Considering the 90-day investment horizon DWS Municipal Income is expected to generate 1.03 times more return on investment than Munivest Fund. However, DWS Municipal is 1.03 times more volatile than Munivest Fund. It trades about 0.07 of its potential returns per unit of risk. Munivest Fund is currently generating about 0.05 per unit of risk. If you would invest 794.00 in DWS Municipal Income on August 24, 2024 and sell it today you would earn a total of 196.00 from holding DWS Municipal Income or generate 24.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DWS Municipal Income vs. Munivest Fund
Performance |
| Timeline |
| DWS Municipal Income |
| Munivest Fund |
DWS Municipal and Munivest Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DWS Municipal and Munivest Fund
The main advantage of trading using opposite DWS Municipal and Munivest Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DWS Municipal position performs unexpectedly, Munivest Fund 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 Munivest Fund will offset losses from the drop in Munivest Fund's long position.| DWS Municipal vs. Pioneer Floating Rate | DWS Municipal vs. The Gabelli Equity | DWS Municipal vs. Pioneer Municipal High | DWS Municipal vs. Nuveen Global High |
| Munivest Fund vs. Tekla Healthcare Investors | Munivest Fund vs. Blackrock Enhanced Capital | Munivest Fund vs. Tekla Life Sciences | Munivest Fund vs. Nuveen New York |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |