Correlation Between Nuveen Missouri and Gabelli Utility

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

By analyzing existing cross correlation between Nuveen Missouri Quality and Gabelli Utility Closed, you can compare the effects of market volatilities on Nuveen Missouri and Gabelli Utility 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 Missouri with a short position of Gabelli Utility. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Missouri and Gabelli Utility.

Diversification Opportunities for Nuveen Missouri and Gabelli Utility

-0.23

Correlation Coefficient

Nuveen Missouri  Gabelli Utility

Very good diversification

The 3 months correlation between Nuveen and Gabelli is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Missouri Quality and Gabelli Utility Closed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gabelli Utility Closed and Nuveen Missouri 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 Missouri Quality are associated (or correlated) with Gabelli Utility. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gabelli Utility Closed has no effect on the direction of Nuveen Missouri i.e., Nuveen Missouri and Gabelli Utility go up and down completely randomly.

Pair Corralation between Nuveen Missouri and Gabelli Utility

Considering the 90-day investment horizon Nuveen Missouri Quality is expected to under-perform the Gabelli Utility. In addition to that, Nuveen Missouri is 2.01 times more volatile than Gabelli Utility Closed. It trades about -0.06 of its total potential returns per unit of risk. Gabelli Utility Closed is currently generating about 0.11 per unit of volatility. If you would invest  503.00  in Gabelli Utility Closed on December 27, 2024 and sell it today you would earn a total of  33.00  from holding Gabelli Utility Closed or generate 6.56% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

Nuveen Missouri Quality  vs.  Gabelli Utility Closed

Nuveen Missouri Quality

Risk-Adjusted Performance

Very Weak

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

Gabelli Utility Closed

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Gabelli Utility Closed are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. In spite of comparatively abnormal basic indicators, Gabelli Utility may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Nuveen Missouri and Gabelli Utility

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

The idea behind Nuveen Missouri Quality and Gabelli Utility Closed 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.