Correlation Between Nuveen Strategic and Lazard Equity

Can any of the company-specific risk be diversified away by investing in both Nuveen Strategic and Lazard Equity 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 Lazard Equity 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 Lazard Equity Franchise, you can compare the effects of market volatilities on Nuveen Strategic and Lazard Equity 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 Lazard Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Strategic and Lazard Equity.

Diversification Opportunities for Nuveen Strategic and Lazard Equity

0.76

Correlation Coefficient

Nuveen Strategic  Lazard Equity

Poor diversification

The 3 months correlation between Nuveen and Lazard is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Strategic Municipal and Lazard Equity Franchise in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard Equity Franchise 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 Lazard Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard Equity Franchise has no effect on the direction of Nuveen Strategic i.e., Nuveen Strategic and Lazard Equity go up and down completely randomly.

Pair Corralation between Nuveen Strategic and Lazard Equity

Assuming the 90 days horizon Nuveen Strategic is expected to generate 6.55 times less return on investment than Lazard Equity. But when comparing it to its historical volatility, Nuveen Strategic Municipal is 3.4 times less risky than Lazard Equity. It trades about 0.08 of its potential returns per unit of risk. Lazard Equity Franchise is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  832.00  in Lazard Equity Franchise on December 20, 2024 and sell it today you would earn a total of  62.00  from holding Lazard Equity Franchise or generate 7.45% return on investment over 90 days.

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

Nuveen Strategic Municipal  vs.  Lazard Equity Franchise

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.

Lazard Equity Franchise

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Lazard Equity Franchise are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Lazard Equity may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Nuveen Strategic and Lazard Equity

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

The idea behind Nuveen Strategic Municipal and Lazard Equity Franchise 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 Transaction History module to view history of all your transactions and understand their impact on performance.