Correlation Between NXG NextGen and Nuveen Floating
Can any of the company-specific risk be diversified away by investing in both NXG NextGen and Nuveen Floating 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 NXG NextGen and Nuveen Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NXG NextGen Infrastructure and Nuveen Floating Rate, you can compare the effects of market volatilities on NXG NextGen and Nuveen Floating 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 NXG NextGen with a short position of Nuveen Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of NXG NextGen and Nuveen Floating.
Diversification Opportunities for NXG NextGen and Nuveen Floating
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between NXG and Nuveen is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding NXG NextGen Infrastructure and Nuveen Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Floating Rate and NXG NextGen 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 NXG NextGen Infrastructure are associated (or correlated) with Nuveen Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Floating Rate has no effect on the direction of NXG NextGen i.e., NXG NextGen and Nuveen Floating go up and down completely randomly.
Pair Corralation between NXG NextGen and Nuveen Floating
Considering the 90-day investment horizon NXG NextGen Infrastructure is expected to generate 2.14 times more return on investment than Nuveen Floating. However, NXG NextGen is 2.14 times more volatile than Nuveen Floating Rate. It trades about 0.75 of its potential returns per unit of risk. Nuveen Floating Rate is currently generating about 0.34 per unit of risk. If you would invest 4,270 in NXG NextGen Infrastructure on August 30, 2024 and sell it today you would earn a total of 870.00 from holding NXG NextGen Infrastructure or generate 20.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
NXG NextGen Infrastructure vs. Nuveen Floating Rate
Performance |
| Timeline |
| NXG NextGen Infrastr |
| Nuveen Floating Rate |
NXG NextGen and Nuveen Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NXG NextGen and Nuveen Floating
The main advantage of trading using opposite NXG NextGen and Nuveen Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NXG NextGen position performs unexpectedly, Nuveen Floating 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 Nuveen Floating will offset losses from the drop in Nuveen Floating's long position.| NXG NextGen vs. MFS Investment Grade | NXG NextGen vs. Invesco High Income | NXG NextGen vs. Eaton Vance National | NXG NextGen vs. Nuveen California Select |
| Nuveen Floating vs. Pioneer Floating Rate | Nuveen Floating vs. BlackRock Floating Rate | Nuveen Floating vs. Blackrock Muni Intermediate | Nuveen Floating vs. Eaton Vance Senior |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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