Correlation Between Nuveen New and Aberdeen Global

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

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

Diversification Opportunities for Nuveen New and Aberdeen Global

-0.14

Correlation Coefficient

Nuveen New  Aberdeen Global

Good diversification

The 3 months correlation between Nuveen and Aberdeen is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen New York and Aberdeen Global IF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberdeen Global IF and Nuveen New 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 New York are associated (or correlated) with Aberdeen Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberdeen Global IF has no effect on the direction of Nuveen New i.e., Nuveen New and Aberdeen Global go up and down completely randomly.

Pair Corralation between Nuveen New and Aberdeen Global

Considering the 90-day investment horizon Nuveen New is expected to generate 3.69 times less return on investment than Aberdeen Global. But when comparing it to its historical volatility, Nuveen New York is 2.88 times less risky than Aberdeen Global. It trades about 0.06 of its potential returns per unit of risk. Aberdeen Global IF is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  348.00  in Aberdeen Global IF on August 31, 2024 and sell it today you would earn a total of  249.00  from holding Aberdeen Global IF or generate 71.55% return on investment over 90 days.

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

Nuveen New York  vs.  Aberdeen Global IF

Nuveen New York

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Nuveen New York are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. Despite quite persistent basic indicators, Nuveen New is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Aberdeen Global IF

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Aberdeen Global IF are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile fundamental indicators, Aberdeen Global may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Pair Trading with Nuveen New and Aberdeen Global

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

The idea behind Nuveen New York and Aberdeen Global IF 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.