Correlation Between Aberdeen Global and Nuveen Core

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

By analyzing existing cross correlation between Aberdeen Global IF and Nuveen Core Plus, you can compare the effects of market volatilities on Aberdeen Global and Nuveen Core 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 Aberdeen Global with a short position of Nuveen Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aberdeen Global and Nuveen Core.

Diversification Opportunities for Aberdeen Global and Nuveen Core

-0.13

Correlation Coefficient

Aberdeen Global  Nuveen Core

Good diversification

The 3 months correlation between Aberdeen and Nuveen is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Aberdeen Global IF and Nuveen Core Plus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Core Plus and Aberdeen Global 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 Aberdeen Global IF are associated (or correlated) with Nuveen Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Core Plus has no effect on the direction of Aberdeen Global i.e., Aberdeen Global and Nuveen Core go up and down completely randomly.

Pair Corralation between Aberdeen Global and Nuveen Core

Considering the 90-day investment horizon Aberdeen Global IF is expected to generate 2.31 times more return on investment than Nuveen Core. However, Aberdeen Global is 2.31 times more volatile than Nuveen Core Plus. It trades about 0.07 of its potential returns per unit of risk. Nuveen Core Plus is currently generating about 0.07 per unit of risk. If you would invest  365.00  in Aberdeen Global IF on September 20, 2024 and sell it today you would earn a total of  228.00  from holding Aberdeen Global IF or generate 62.47% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

Aberdeen Global IF  vs.  Nuveen Core Plus

Aberdeen Global IF

Risk-Adjusted Performance

2 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Aberdeen Global IF are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy fundamental indicators, Aberdeen Global is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Nuveen Core Plus

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Nuveen Core Plus has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable fundamental indicators, Nuveen Core is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Aberdeen Global and Nuveen Core

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

The idea behind Aberdeen Global IF and Nuveen Core Plus 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.