Correlation Between Nuveen Municipal and American Funds
Can any of the company-specific risk be diversified away by investing in both Nuveen Municipal and American Funds 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 Municipal and American Funds into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nuveen Municipal High and American Funds The, you can compare the effects of market volatilities on Nuveen Municipal and American Funds 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 Municipal with a short position of American Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Municipal and American Funds.
Diversification Opportunities for Nuveen Municipal and American Funds
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nuveen and American is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Municipal High and American Funds The in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Funds and Nuveen 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 Nuveen Municipal High are associated (or correlated) with American Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Funds has no effect on the direction of Nuveen Municipal i.e., Nuveen Municipal and American Funds go up and down completely randomly.
Pair Corralation between Nuveen Municipal and American Funds
Assuming the 90 days horizon Nuveen Municipal is expected to generate 1.61 times less return on investment than American Funds. In addition to that, Nuveen Municipal is 1.26 times more volatile than American Funds The. It trades about 0.16 of its total potential returns per unit of risk. American Funds The is currently generating about 0.33 per unit of volatility. If you would invest 1,116 in American Funds The on December 4, 2024 and sell it today you would earn a total of 23.00 from holding American Funds The or generate 2.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nuveen Municipal High vs. American Funds The
Performance |
| Timeline |
| Nuveen Municipal High |
| American Funds |
Nuveen Municipal and American Funds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nuveen Municipal and American Funds
The main advantage of trading using opposite Nuveen Municipal and American Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuveen Municipal position performs unexpectedly, American Funds 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 American Funds will offset losses from the drop in American Funds' long position.| Nuveen Municipal vs. Lord Abbett Affiliated | Nuveen Municipal vs. Touchstone Large Cap | Nuveen Municipal vs. Profunds Large Cap Growth | Nuveen Municipal vs. Transamerica Large Cap |
| American Funds vs. Simt Multi Asset Inflation | American Funds vs. Ab Bond Inflation | American Funds vs. Tiaa Cref Inflation Linked Bond | American Funds vs. The Hartford Inflation |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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