Correlation Between Nuveen Amt-free and Tekla Healthcare
Can any of the company-specific risk be diversified away by investing in both Nuveen Amt-free and Tekla Healthcare 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 Amt-free and Tekla Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nuveen Amt Free Municipal and Tekla Healthcare Investors, you can compare the effects of market volatilities on Nuveen Amt-free and Tekla Healthcare 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 Amt-free with a short position of Tekla Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Amt-free and Tekla Healthcare.
Diversification Opportunities for Nuveen Amt-free and Tekla Healthcare
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Nuveen and Tekla is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Amt Free Municipal and Tekla Healthcare Investors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tekla Healthcare Inv and Nuveen Amt-free 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 Amt Free Municipal are associated (or correlated) with Tekla Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tekla Healthcare Inv has no effect on the direction of Nuveen Amt-free i.e., Nuveen Amt-free and Tekla Healthcare go up and down completely randomly.
Pair Corralation between Nuveen Amt-free and Tekla Healthcare
Considering the 90-day investment horizon Nuveen Amt-free is expected to generate 1.35 times less return on investment than Tekla Healthcare. But when comparing it to its historical volatility, Nuveen Amt Free Municipal is 2.49 times less risky than Tekla Healthcare. It trades about 0.1 of its potential returns per unit of risk. Tekla Healthcare Investors is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,599 in Tekla Healthcare Investors on August 24, 2024 and sell it today you would earn a total of 119.00 from holding Tekla Healthcare Investors or generate 7.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nuveen Amt Free Municipal vs. Tekla Healthcare Investors
Performance |
| Timeline |
| Nuveen Amt Free |
| Tekla Healthcare Inv |
Nuveen Amt-free and Tekla Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nuveen Amt-free and Tekla Healthcare
The main advantage of trading using opposite Nuveen Amt-free and Tekla Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuveen Amt-free position performs unexpectedly, Tekla Healthcare 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 Tekla Healthcare will offset losses from the drop in Tekla Healthcare's long position.| Nuveen Amt-free vs. Tekla Healthcare Investors | Nuveen Amt-free vs. Blackrock Enhanced Capital | Nuveen Amt-free vs. Tekla Life Sciences | Nuveen Amt-free vs. Nuveen New York |
| Tekla Healthcare vs. Tekla Healthcare Opportunities | Tekla Healthcare vs. Eaton Vance Tax | Tekla Healthcare vs. Tekla World Healthcare | Tekla Healthcare vs. Cohen Steers Limited |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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