Correlation Between Needham Aggressive and Nuveen Dividend
Can any of the company-specific risk be diversified away by investing in both Needham Aggressive and Nuveen Dividend 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 Needham Aggressive and Nuveen Dividend into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Needham Aggressive Growth and Nuveen Dividend Value, you can compare the effects of market volatilities on Needham Aggressive and Nuveen Dividend 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 Needham Aggressive with a short position of Nuveen Dividend. Check out your portfolio center. Please also check ongoing floating volatility patterns of Needham Aggressive and Nuveen Dividend.
Diversification Opportunities for Needham Aggressive and Nuveen Dividend
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Needham and Nuveen is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Needham Aggressive Growth and Nuveen Dividend Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Dividend Value and Needham Aggressive 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 Needham Aggressive Growth are associated (or correlated) with Nuveen Dividend. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Dividend Value has no effect on the direction of Needham Aggressive i.e., Needham Aggressive and Nuveen Dividend go up and down completely randomly.
Pair Corralation between Needham Aggressive and Nuveen Dividend
Assuming the 90 days horizon Needham Aggressive Growth is expected to under-perform the Nuveen Dividend. In addition to that, Needham Aggressive is 1.69 times more volatile than Nuveen Dividend Value. It trades about -0.01 of its total potential returns per unit of risk. Nuveen Dividend Value is currently generating about 0.01 per unit of volatility. If you would invest 1,471 in Nuveen Dividend Value on December 2, 2024 and sell it today you would earn a total of 19.00 from holding Nuveen Dividend Value or generate 1.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Needham Aggressive Growth vs. Nuveen Dividend Value
Performance |
| Timeline |
| Needham Aggressive Growth |
| Nuveen Dividend Value |
Needham Aggressive and Nuveen Dividend Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Needham Aggressive and Nuveen Dividend
The main advantage of trading using opposite Needham Aggressive and Nuveen Dividend positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Needham Aggressive position performs unexpectedly, Nuveen Dividend 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 Dividend will offset losses from the drop in Nuveen Dividend's long position.| Needham Aggressive vs. Needham Aggressive Growth | Needham Aggressive vs. Needham Small Cap | Needham Aggressive vs. Ultramid Cap Profund Ultramid Cap | Needham Aggressive vs. Fidelity Advisor Semiconductors |
| Nuveen Dividend vs. Franklin Natural Resources | Nuveen Dividend vs. Clearbridge Energy Mlp | Nuveen Dividend vs. Hennessy Bp Energy | Nuveen Dividend vs. Pimco Energy Tactical |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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