Correlation Between Nuveen Core and Nuveen Amt

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

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

Diversification Opportunities for Nuveen Core and Nuveen Amt

0.0

Correlation Coefficient

Nuveen Core  Nuveen Amt

Pay attention - limited upside

The 3 months correlation between Nuveen and Nuveen is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Core Equity and Nuveen Amt Free in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Amt Free and Nuveen Core 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 Core Equity are associated (or correlated) with Nuveen Amt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Amt Free has no effect on the direction of Nuveen Core i.e., Nuveen Core and Nuveen Amt go up and down completely randomly.

Pair Corralation between Nuveen Core and Nuveen Amt

Considering the 90-day investment horizon Nuveen Core Equity is expected to under-perform the Nuveen Amt. In addition to that, Nuveen Core is 1.68 times more volatile than Nuveen Amt Free. It trades about -0.08 of its total potential returns per unit of risk. Nuveen Amt Free is currently generating about 0.09 per unit of volatility. If you would invest  1,192  in Nuveen Amt Free on December 20, 2024 and sell it today you would earn a total of  35.00  from holding Nuveen Amt Free or generate 2.94% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Nuveen Core Equity  vs.  Nuveen Amt Free

Nuveen Core Equity

Risk-Adjusted Performance

Very Weak

Over the last 90 days Nuveen Core Equity has generated negative risk-adjusted returns adding no value to fund investors. In spite of rather sound fundamental indicators, Nuveen Core is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Nuveen Amt Free

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Nuveen Amt Free are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. Despite nearly stable basic indicators, Nuveen Amt is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Nuveen Core and Nuveen Amt

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

The idea behind Nuveen Core Equity and Nuveen Amt Free 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.