Correlation Between Nuveen Floating and Kkr Income

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

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

Diversification Opportunities for Nuveen Floating and Kkr Income

0.69

Correlation Coefficient

Nuveen Floating  Kkr Income

Poor diversification

The 3 months correlation between Nuveen and Kkr is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Floating Rate and Kkr Income Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kkr Income Opportunities and Nuveen Floating 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 Floating Rate are associated (or correlated) with Kkr Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kkr Income Opportunities has no effect on the direction of Nuveen Floating i.e., Nuveen Floating and Kkr Income go up and down completely randomly.

Pair Corralation between Nuveen Floating and Kkr Income

Considering the 90-day investment horizon Nuveen Floating Rate is expected to under-perform the Kkr Income. But the fund apears to be less risky and, when comparing its historical volatility, Nuveen Floating Rate is 1.02 times less risky than Kkr Income. The fund trades about -0.08 of its potential returns per unit of risk. The Kkr Income Opportunities is currently generating about -0.06 of returns per unit of risk over similar time horizon. If you would invest  1,264  in Kkr Income Opportunities on December 23, 2024 and sell it today you would lose (31.00) from holding Kkr Income Opportunities or give up 2.45% of portfolio value over 90 days.

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

Nuveen Floating Rate  vs.  Kkr Income Opportunities

Nuveen Floating Rate

Risk-Adjusted Performance

Very Weak

Over the last 90 days Nuveen Floating Rate has generated negative risk-adjusted returns adding no value to fund investors. Even with relatively invariable technical and fundamental indicators, Nuveen Floating is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Kkr Income Opportunities

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kkr Income Opportunities has generated negative risk-adjusted returns adding no value to fund investors. In spite of very healthy forward indicators, Kkr Income is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Nuveen Floating and Kkr Income

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

The idea behind Nuveen Floating Rate and Kkr Income Opportunities 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.