Correlation Between Nuveen Amt and Aberdeen Income
Can any of the company-specific risk be diversified away by investing in both Nuveen Amt and Aberdeen Income 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 and Aberdeen Income into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nuveen Amt Free and Aberdeen Income Credit, you can compare the effects of market volatilities on Nuveen Amt and Aberdeen Income 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 with a short position of Aberdeen Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Amt and Aberdeen Income.
Diversification Opportunities for Nuveen Amt and Aberdeen Income
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nuveen and Aberdeen is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Amt Free and Aberdeen Income Credit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberdeen Income Credit and Nuveen Amt 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 are associated (or correlated) with Aberdeen Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberdeen Income Credit has no effect on the direction of Nuveen Amt i.e., Nuveen Amt and Aberdeen Income go up and down completely randomly.
Pair Corralation between Nuveen Amt and Aberdeen Income
Considering the 90-day investment horizon Nuveen Amt Free is expected to generate 0.7 times more return on investment than Aberdeen Income. However, Nuveen Amt Free is 1.43 times less risky than Aberdeen Income. It trades about 0.04 of its potential returns per unit of risk. Aberdeen Income Credit is currently generating about 0.02 per unit of risk. If you would invest 1,103 in Nuveen Amt Free on October 9, 2024 and sell it today you would earn a total of 140.00 from holding Nuveen Amt Free or generate 12.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nuveen Amt Free vs. Aberdeen Income Credit
Performance |
| Timeline |
| Nuveen Amt Free |
| Aberdeen Income Credit |
Nuveen Amt and Aberdeen Income Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nuveen Amt and Aberdeen Income
The main advantage of trading using opposite Nuveen Amt and Aberdeen Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuveen Amt position performs unexpectedly, Aberdeen Income 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 Aberdeen Income will offset losses from the drop in Aberdeen Income's long position.| Nuveen Amt vs. Nuveen Amt Free Municipal | Nuveen Amt vs. Nuveen Dividend Advantage | Nuveen Amt vs. Nuveen Municipal High | Nuveen Amt vs. Nuveen Municipal Value |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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