Correlation Between Nuveen New and Resq Strategic
Can any of the company-specific risk be diversified away by investing in both Nuveen New and Resq Strategic 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 New and Resq Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nuveen New Jersey and Resq Strategic Income, you can compare the effects of market volatilities on Nuveen New and Resq Strategic 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 New with a short position of Resq Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen New and Resq Strategic.
Diversification Opportunities for Nuveen New and Resq Strategic
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Nuveen and Resq is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen New Jersey and Resq Strategic Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Resq Strategic Income and Nuveen New 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 New Jersey are associated (or correlated) with Resq Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Resq Strategic Income has no effect on the direction of Nuveen New i.e., Nuveen New and Resq Strategic go up and down completely randomly.
Pair Corralation between Nuveen New and Resq Strategic
Considering the 90-day investment horizon Nuveen New Jersey is expected to generate 0.7 times more return on investment than Resq Strategic. However, Nuveen New Jersey is 1.43 times less risky than Resq Strategic. It trades about 0.07 of its potential returns per unit of risk. Resq Strategic Income is currently generating about -0.01 per unit of risk. If you would invest 1,110 in Nuveen New Jersey on November 9, 2024 and sell it today you would earn a total of 110.00 from holding Nuveen New Jersey or generate 9.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nuveen New Jersey vs. Resq Strategic Income
Performance |
| Timeline |
| Nuveen New Jersey |
| Resq Strategic Income |
Nuveen New and Resq Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nuveen New and Resq Strategic
The main advantage of trading using opposite Nuveen New and Resq Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuveen New position performs unexpectedly, Resq Strategic 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 Resq Strategic will offset losses from the drop in Resq Strategic's long position.| Nuveen New vs. Munivest Fund | Nuveen New vs. Blackrock Muni Intermediate | Nuveen New vs. Blackrock Muniyield Quality | Nuveen New vs. Blackrock Muniyield Quality |
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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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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