Correlation Between Pimco Municipal and Nuveen Amt
Can any of the company-specific risk be diversified away by investing in both Pimco Municipal and Nuveen Amt 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 Pimco Municipal and Nuveen Amt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pimco Municipal Income and Nuveen Amt Free, you can compare the effects of market volatilities on Pimco Municipal and Nuveen Amt 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 Pimco Municipal with a short position of Nuveen Amt. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco Municipal and Nuveen Amt.
Diversification Opportunities for Pimco Municipal and Nuveen Amt
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Pimco and Nuveen is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Pimco Municipal Income and Nuveen Amt Free in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Amt Free and Pimco Municipal 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 Pimco Municipal Income are associated (or correlated) with Nuveen Amt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Amt Free has no effect on the direction of Pimco Municipal i.e., Pimco Municipal and Nuveen Amt go up and down completely randomly.
Pair Corralation between Pimco Municipal and Nuveen Amt
Considering the 90-day investment horizon Pimco Municipal is expected to generate 2.58 times less return on investment than Nuveen Amt. In addition to that, Pimco Municipal is 1.11 times more volatile than Nuveen Amt Free. It trades about 0.12 of its total potential returns per unit of risk. Nuveen Amt Free is currently generating about 0.35 per unit of volatility. If you would invest 1,246 in Nuveen Amt Free on September 2, 2024 and sell it today you would earn a total of 78.00 from holding Nuveen Amt Free or generate 6.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pimco Municipal Income vs. Nuveen Amt Free
Performance |
| Timeline |
| Pimco Municipal Income |
| Nuveen Amt Free |
Pimco Municipal and Nuveen Amt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pimco Municipal and Nuveen Amt
The main advantage of trading using opposite Pimco Municipal and Nuveen Amt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco Municipal position performs unexpectedly, Nuveen Amt 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 Amt will offset losses from the drop in Nuveen Amt's long position.| Pimco Municipal vs. MFS Investment Grade | Pimco Municipal vs. Eaton Vance Municipal | Pimco Municipal vs. DTF Tax Free | Pimco Municipal vs. Aquagold International |
| Nuveen Amt vs. MFS Investment Grade | Nuveen Amt vs. Eaton Vance Municipal | Nuveen Amt vs. DTF Tax Free | Nuveen Amt vs. Aquagold International |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |