Correlation Between Nuveen Santa and Ab Municipal
Can any of the company-specific risk be diversified away by investing in both Nuveen Santa and Ab Municipal 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 Santa and Ab Municipal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nuveen Santa Barbara and Ab Municipal Bond, you can compare the effects of market volatilities on Nuveen Santa and Ab Municipal 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 Santa with a short position of Ab Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Santa and Ab Municipal.
Diversification Opportunities for Nuveen Santa and Ab Municipal
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nuveen and AUNTX is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Santa Barbara and Ab Municipal Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab Municipal Bond and Nuveen Santa 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 Santa Barbara are associated (or correlated) with Ab Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab Municipal Bond has no effect on the direction of Nuveen Santa i.e., Nuveen Santa and Ab Municipal go up and down completely randomly.
Pair Corralation between Nuveen Santa and Ab Municipal
Assuming the 90 days horizon Nuveen Santa Barbara is expected to generate 3.77 times more return on investment than Ab Municipal. However, Nuveen Santa is 3.77 times more volatile than Ab Municipal Bond. It trades about 0.15 of its potential returns per unit of risk. Ab Municipal Bond is currently generating about 0.21 per unit of risk. If you would invest 6,561 in Nuveen Santa Barbara on August 29, 2024 and sell it today you would earn a total of 140.00 from holding Nuveen Santa Barbara or generate 2.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Nuveen Santa Barbara vs. Ab Municipal Bond
Performance |
| Timeline |
| Nuveen Santa Barbara |
| Ab Municipal Bond |
Nuveen Santa and Ab Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nuveen Santa and Ab Municipal
The main advantage of trading using opposite Nuveen Santa and Ab Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuveen Santa position performs unexpectedly, Ab Municipal 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 Ab Municipal will offset losses from the drop in Ab Municipal's long position.| Nuveen Santa vs. Gabelli Gold Fund | Nuveen Santa vs. Precious Metals And | Nuveen Santa vs. Short Precious Metals | Nuveen Santa vs. Gold Portfolio Fidelity |
| Ab Municipal vs. Vanguard Limited Term Tax Exempt | Ab Municipal vs. HUMANA INC | Ab Municipal vs. Aquagold International | Ab Municipal vs. Barloworld Ltd ADR |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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