Correlation Between Legal General and Nuveen Global
Can any of the company-specific risk be diversified away by investing in both Legal General and Nuveen 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 Legal General and Nuveen Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Legal General Group and Nuveen Global High, you can compare the effects of market volatilities on Legal General and Nuveen 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 Legal General with a short position of Nuveen Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Legal General and Nuveen Global.
Diversification Opportunities for Legal General and Nuveen Global
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Legal and Nuveen is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Legal General Group and Nuveen Global High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Global High and Legal General 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 Legal General Group are associated (or correlated) with Nuveen Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Global High has no effect on the direction of Legal General i.e., Legal General and Nuveen Global go up and down completely randomly.
Pair Corralation between Legal General and Nuveen Global
Assuming the 90 days horizon Legal General is expected to generate 1.84 times less return on investment than Nuveen Global. In addition to that, Legal General is 1.77 times more volatile than Nuveen Global High. It trades about 0.03 of its total potential returns per unit of risk. Nuveen Global High is currently generating about 0.1 per unit of volatility. If you would invest 918.00 in Nuveen Global High on September 12, 2024 and sell it today you would earn a total of 412.00 from holding Nuveen Global High or generate 44.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Legal General Group vs. Nuveen Global High
Performance |
| Timeline |
| Legal General Group |
| Nuveen Global High |
Legal General and Nuveen Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Legal General and Nuveen Global
The main advantage of trading using opposite Legal General and Nuveen Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Legal General position performs unexpectedly, Nuveen 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 Nuveen Global will offset losses from the drop in Nuveen Global's long position.| Legal General vs. Nuveen Global High | Legal General vs. New America High | Legal General vs. Brookfield Business Corp | Legal General vs. Elysee Development Corp |
| Nuveen Global vs. Brookfield Real Assets | Nuveen Global vs. Guggenheim Strategic Opportunities | Nuveen Global vs. Cornerstone Strategic Return | Nuveen Global vs. Cornerstone Strategic Value |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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