Correlation Between Nuveen Municipal and Clough Global
Can any of the company-specific risk be diversified away by investing in both Nuveen Municipal and Clough 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 Nuveen Municipal and Clough Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nuveen Municipal Credit and Clough Global Opportunities, you can compare the effects of market volatilities on Nuveen Municipal and Clough 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 Nuveen Municipal with a short position of Clough Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Municipal and Clough Global.
Diversification Opportunities for Nuveen Municipal and Clough Global
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Nuveen and Clough is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Municipal Credit and Clough Global Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clough Global Opport and Nuveen 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 Nuveen Municipal Credit are associated (or correlated) with Clough Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clough Global Opport has no effect on the direction of Nuveen Municipal i.e., Nuveen Municipal and Clough Global go up and down completely randomly.
Pair Corralation between Nuveen Municipal and Clough Global
Given the investment horizon of 90 days Nuveen Municipal Credit is expected to generate 0.9 times more return on investment than Clough Global. However, Nuveen Municipal Credit is 1.11 times less risky than Clough Global. It trades about -0.04 of its potential returns per unit of risk. Clough Global Opportunities is currently generating about -0.14 per unit of risk. If you would invest 1,121 in Nuveen Municipal Credit on September 12, 2024 and sell it today you would lose (6.00) from holding Nuveen Municipal Credit or give up 0.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nuveen Municipal Credit vs. Clough Global Opportunities
Performance |
| Timeline |
| Nuveen Municipal Credit |
| Clough Global Opport |
Nuveen Municipal and Clough Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nuveen Municipal and Clough Global
The main advantage of trading using opposite Nuveen Municipal and Clough Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuveen Municipal position performs unexpectedly, Clough 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 Clough Global will offset losses from the drop in Clough Global's long position.| Nuveen Municipal vs. Nuveen High Yield | Nuveen Municipal vs. Nuveen High Yield | Nuveen Municipal vs. SCOR PK | Nuveen Municipal vs. Morningstar Unconstrained Allocation |
| Clough Global vs. Oxford Lane Capital | Clough Global vs. Orchid Island Capital | Clough Global vs. Guggenheim Strategic Opportunities | Clough Global vs. Stone Harbor Emerging |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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