Correlation Between Nuveen Core and Templeton Global

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

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

Diversification Opportunities for Nuveen Core and Templeton Global

0.23

Correlation Coefficient

Nuveen Core  Templeton Global

Modest diversification

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

Pair Corralation between Nuveen Core and Templeton Global

If you would invest  1,101  in Nuveen Core Plus on September 19, 2024 and sell it today you would earn a total of  2.00  from holding Nuveen Core Plus or generate 0.18% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	4.76%
Values	Daily Returns

Nuveen Core Plus  vs.  Templeton Global Income

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.

Templeton Global Income

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Templeton Global Income has generated negative risk-adjusted returns adding no value to fund investors. In spite of very healthy forward indicators, Templeton Global 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 Core and Templeton Global

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

The idea behind Nuveen Core Plus and Templeton Global Income 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.

Check out your portfolio center.

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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.