Correlation Between Armada Hflr and Nuveen Us

Can any of the company-specific risk be diversified away by investing in both Armada Hflr and Nuveen Us 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 Armada Hflr and Nuveen Us into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Armada Hflr Pr and Nuveen Infrastructure Income, you can compare the effects of market volatilities on Armada Hflr and Nuveen Us 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 Armada Hflr with a short position of Nuveen Us. Check out your portfolio center. Please also check ongoing floating volatility patterns of Armada Hflr and Nuveen Us.

Diversification Opportunities for Armada Hflr and Nuveen Us

-0.56

Correlation Coefficient

Armada Hflr  Nuveen Us

Excellent diversification

The 3 months correlation between Armada and Nuveen is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Armada Hflr Pr and Nuveen Infrastructure Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Infrastructure and Armada Hflr 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 Armada Hflr Pr are associated (or correlated) with Nuveen Us. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Infrastructure has no effect on the direction of Armada Hflr i.e., Armada Hflr and Nuveen Us go up and down completely randomly.

Pair Corralation between Armada Hflr and Nuveen Us

Considering the 90-day investment horizon Armada Hflr Pr is expected to under-perform the Nuveen Us. In addition to that, Armada Hflr is 33.48 times more volatile than Nuveen Infrastructure Income. It trades about -0.18 of its total potential returns per unit of risk. Nuveen Infrastructure Income is currently generating about 0.42 per unit of volatility. If you would invest  1,000.00  in Nuveen Infrastructure Income on December 3, 2024 and sell it today you would earn a total of  11.00  from holding Nuveen Infrastructure Income or generate 1.1% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Armada Hflr Pr  vs.  Nuveen Infrastructure Income

Armada Hflr Pr

Risk-Adjusted Performance

Very Weak

Over the last 90 days Armada Hflr Pr has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Nuveen Infrastructure

Risk-Adjusted Performance

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Nuveen Infrastructure Income are ranked lower than 33 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Nuveen Us is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Armada Hflr and Nuveen Us

The main advantage of trading using opposite Armada Hflr and Nuveen Us positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Armada Hflr position performs unexpectedly, Nuveen Us 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 Us will offset losses from the drop in Nuveen Us' long position.

The idea behind Armada Hflr Pr and Nuveen Infrastructure Income pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.