Correlation Between Thornburg International and Nuveen Minnesota
Can any of the company-specific risk be diversified away by investing in both Thornburg International and Nuveen Minnesota 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 Thornburg International and Nuveen Minnesota into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thornburg International Value and Nuveen Minnesota Municipal, you can compare the effects of market volatilities on Thornburg International and Nuveen Minnesota 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 Thornburg International with a short position of Nuveen Minnesota. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thornburg International and Nuveen Minnesota.
Diversification Opportunities for Thornburg International and Nuveen Minnesota
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Thornburg and Nuveen is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Thornburg International Value and Nuveen Minnesota Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Minnesota Mun and Thornburg International 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 Thornburg International Value are associated (or correlated) with Nuveen Minnesota. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Minnesota Mun has no effect on the direction of Thornburg International i.e., Thornburg International and Nuveen Minnesota go up and down completely randomly.
Pair Corralation between Thornburg International and Nuveen Minnesota
Assuming the 90 days horizon Thornburg International Value is expected to under-perform the Nuveen Minnesota. In addition to that, Thornburg International is 4.23 times more volatile than Nuveen Minnesota Municipal. It trades about -0.09 of its total potential returns per unit of risk. Nuveen Minnesota Municipal is currently generating about 0.06 per unit of volatility. If you would invest 1,081 in Nuveen Minnesota Municipal on September 12, 2024 and sell it today you would earn a total of 10.00 from holding Nuveen Minnesota Municipal or generate 0.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thornburg International Value vs. Nuveen Minnesota Municipal
Performance |
| Timeline |
| Thornburg International |
| Nuveen Minnesota Mun |
Thornburg International and Nuveen Minnesota Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thornburg International and Nuveen Minnesota
The main advantage of trading using opposite Thornburg International and Nuveen Minnesota positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thornburg International position performs unexpectedly, Nuveen Minnesota 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 Minnesota will offset losses from the drop in Nuveen Minnesota's long position.| Thornburg International vs. Artisan Select Equity | Thornburg International vs. Multimedia Portfolio Multimedia | Thornburg International vs. Cutler Equity | Thornburg International vs. Ms Global Fixed |
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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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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