Correlation Between Nuveen Strategic and Huber Capital

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

By analyzing existing cross correlation between Nuveen Strategic Municipal and Huber Capital Small, you can compare the effects of market volatilities on Nuveen Strategic and Huber Capital 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 Strategic with a short position of Huber Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Strategic and Huber Capital.

Diversification Opportunities for Nuveen Strategic and Huber Capital

-0.57

Correlation Coefficient

Nuveen Strategic  Huber Capital

Excellent diversification

The 3 months correlation between Nuveen and Huber is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Strategic Municipal and Huber Capital Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huber Capital Small and Nuveen Strategic 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 Strategic Municipal are associated (or correlated) with Huber Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huber Capital Small has no effect on the direction of Nuveen Strategic i.e., Nuveen Strategic and Huber Capital go up and down completely randomly.

Pair Corralation between Nuveen Strategic and Huber Capital

Assuming the 90 days horizon Nuveen Strategic Municipal is expected to generate 0.19 times more return on investment than Huber Capital. However, Nuveen Strategic Municipal is 5.31 times less risky than Huber Capital. It trades about 0.08 of its potential returns per unit of risk. Huber Capital Small is currently generating about -0.09 per unit of risk. If you would invest  984.00  in Nuveen Strategic Municipal on December 20, 2024 and sell it today you would earn a total of  11.00  from holding Nuveen Strategic Municipal or generate 1.12% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.33%
Values	Daily Returns

Nuveen Strategic Municipal  vs.  Huber Capital Small

Nuveen Strategic Mun

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Nuveen Strategic Municipal are ranked lower than 6 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Nuveen Strategic is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Huber Capital Small

Risk-Adjusted Performance

Very Weak

Over the last 90 days Huber Capital Small has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Nuveen Strategic and Huber Capital

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

The idea behind Nuveen Strategic Municipal and Huber Capital Small 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.