Correlation Between Brandywineglobal and Nuveen Municipal

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

By analyzing existing cross correlation between Brandywineglobal Globalome Opportunities and Nuveen Municipal Credit, you can compare the effects of market volatilities on Brandywineglobal and Nuveen Municipal 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 Brandywineglobal with a short position of Nuveen Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brandywineglobal and Nuveen Municipal.

Diversification Opportunities for Brandywineglobal and Nuveen Municipal

0.71

Correlation Coefficient

Brandywineglobal  Nuveen Municipal

Poor diversification

The 3 months correlation between Brandywineglobal and Nuveen is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Brandywineglobal Globalome Opp and Nuveen Municipal Credit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Municipal Credit and Brandywineglobal 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 Brandywineglobal Globalome Opportunities are associated (or correlated) with Nuveen Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Municipal Credit has no effect on the direction of Brandywineglobal i.e., Brandywineglobal and Nuveen Municipal go up and down completely randomly.

Pair Corralation between Brandywineglobal and Nuveen Municipal

Considering the 90-day investment horizon Brandywineglobal Globalome Opportunities is expected to generate 0.92 times more return on investment than Nuveen Municipal. However, Brandywineglobal Globalome Opportunities is 1.09 times less risky than Nuveen Municipal. It trades about 0.0 of its potential returns per unit of risk. Nuveen Municipal Credit is currently generating about -0.15 per unit of risk. If you would invest  851.00  in Brandywineglobal Globalome Opportunities on September 12, 2024 and sell it today you would lose (1.00) from holding Brandywineglobal Globalome Opportunities or give up 0.12% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Brandywineglobal Globalome Opp  vs.  Nuveen Municipal Credit

Brandywineglobal Glo

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Brandywineglobal Globalome Opportunities has generated negative risk-adjusted returns adding no value to fund investors. Despite nearly stable basic indicators, Brandywineglobal is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Nuveen Municipal Credit

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Nuveen Municipal Credit has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's fundamental indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the fund investors.

Pair Trading with Brandywineglobal and Nuveen Municipal

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

The idea behind Brandywineglobal Globalome Opportunities and Nuveen Municipal Credit 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.