Correlation Between Nationwide Loomis and Nationwide Core

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

By analyzing existing cross correlation between Nationwide Loomis All and Nationwide E Plus, you can compare the effects of market volatilities on Nationwide Loomis and Nationwide Core 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 Nationwide Loomis with a short position of Nationwide Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nationwide Loomis and Nationwide Core.

Diversification Opportunities for Nationwide Loomis and Nationwide Core

0.4

Correlation Coefficient

Nationwide Loomis  Nationwide Core

Very weak diversification

The 3 months correlation between Nationwide and Nationwide is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Nationwide Loomis All and Nationwide E Plus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nationwide E Plus and Nationwide Loomis 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 Nationwide Loomis All are associated (or correlated) with Nationwide Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nationwide E Plus has no effect on the direction of Nationwide Loomis i.e., Nationwide Loomis and Nationwide Core go up and down completely randomly.

Pair Corralation between Nationwide Loomis and Nationwide Core

Assuming the 90 days horizon Nationwide Loomis All is expected to under-perform the Nationwide Core. In addition to that, Nationwide Loomis is 3.88 times more volatile than Nationwide E Plus. It trades about -0.08 of its total potential returns per unit of risk. Nationwide E Plus is currently generating about 0.05 per unit of volatility. If you would invest  895.00  in Nationwide E Plus on November 28, 2024 and sell it today you would earn a total of  10.00  from holding Nationwide E Plus or generate 1.12% return on investment over 90 days.

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

Nationwide Loomis All  vs.  Nationwide E Plus

Nationwide Loomis All

Risk-Adjusted Performance

Very Weak

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

Nationwide E Plus

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Nationwide E Plus are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Nationwide Core is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Nationwide Loomis and Nationwide Core

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

The idea behind Nationwide Loomis All and Nationwide E Plus 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.