Correlation Between Nuveen Santa and Westwood Largecap
Can any of the company-specific risk be diversified away by investing in both Nuveen Santa and Westwood Largecap 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 Westwood Largecap 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 Westwood Largecap Value, you can compare the effects of market volatilities on Nuveen Santa and Westwood Largecap 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 Westwood Largecap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Santa and Westwood Largecap.
Diversification Opportunities for Nuveen Santa and Westwood Largecap
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Nuveen and Westwood is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Santa Barbara and Westwood Largecap Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westwood Largecap Value 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 Westwood Largecap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westwood Largecap Value has no effect on the direction of Nuveen Santa i.e., Nuveen Santa and Westwood Largecap go up and down completely randomly.
Pair Corralation between Nuveen Santa and Westwood Largecap
Assuming the 90 days horizon Nuveen Santa Barbara is expected to generate 0.73 times more return on investment than Westwood Largecap. However, Nuveen Santa Barbara is 1.38 times less risky than Westwood Largecap. It trades about 0.06 of its potential returns per unit of risk. Westwood Largecap Value is currently generating about -0.09 per unit of risk. If you would invest 6,672 in Nuveen Santa Barbara on September 13, 2024 and sell it today you would earn a total of 32.00 from holding Nuveen Santa Barbara or generate 0.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nuveen Santa Barbara vs. Westwood Largecap Value
Performance |
| Timeline |
| Nuveen Santa Barbara |
| Westwood Largecap Value |
Nuveen Santa and Westwood Largecap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nuveen Santa and Westwood Largecap
The main advantage of trading using opposite Nuveen Santa and Westwood Largecap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuveen Santa position performs unexpectedly, Westwood Largecap 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 Westwood Largecap will offset losses from the drop in Westwood Largecap's long position.| Nuveen Santa vs. Nuveen Small Cap | Nuveen Santa vs. Nuveen Real Estate | Nuveen Santa vs. Nuveen Real Estate | Nuveen Santa vs. Nuveen Preferred Securities |
| Westwood Largecap vs. Pnc Emerging Markets | Westwood Largecap vs. Shelton Emerging Markets | Westwood Largecap vs. Locorr Market Trend | Westwood Largecap vs. Rbc Emerging Markets |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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