Correlation Between Commodities Strategy and Nuveen Intermediate
Can any of the company-specific risk be diversified away by investing in both Commodities Strategy and Nuveen Intermediate 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 Commodities Strategy and Nuveen Intermediate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Commodities Strategy Fund and Nuveen Intermediate Duration, you can compare the effects of market volatilities on Commodities Strategy and Nuveen Intermediate 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 Commodities Strategy with a short position of Nuveen Intermediate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Commodities Strategy and Nuveen Intermediate.
Diversification Opportunities for Commodities Strategy and Nuveen Intermediate
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Commodities and Nuveen is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Commodities Strategy Fund and Nuveen Intermediate Duration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Intermediate and Commodities Strategy 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 Commodities Strategy Fund are associated (or correlated) with Nuveen Intermediate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Intermediate has no effect on the direction of Commodities Strategy i.e., Commodities Strategy and Nuveen Intermediate go up and down completely randomly.
Pair Corralation between Commodities Strategy and Nuveen Intermediate
Assuming the 90 days horizon Commodities Strategy Fund is expected to under-perform the Nuveen Intermediate. In addition to that, Commodities Strategy is 3.2 times more volatile than Nuveen Intermediate Duration. It trades about -0.1 of its total potential returns per unit of risk. Nuveen Intermediate Duration is currently generating about 0.19 per unit of volatility. If you would invest 886.00 in Nuveen Intermediate Duration on September 6, 2024 and sell it today you would earn a total of 10.00 from holding Nuveen Intermediate Duration or generate 1.13% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 95.45% |
Values | Daily Returns |
Commodities Strategy Fund vs. Nuveen Intermediate Duration
Performance |
Timeline |
Commodities Strategy |
Nuveen Intermediate |
Commodities Strategy and Nuveen Intermediate Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Commodities Strategy and Nuveen Intermediate
The main advantage of trading using opposite Commodities Strategy and Nuveen Intermediate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Commodities Strategy position performs unexpectedly, Nuveen Intermediate 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 Nuveen Intermediate will offset losses from the drop in Nuveen Intermediate's long position.Commodities Strategy vs. Basic Materials Fund | Commodities Strategy vs. Energy Services Fund | Commodities Strategy vs. Energy Fund Investor | Commodities Strategy vs. Real Estate Fund |
Nuveen Intermediate vs. Volumetric Fund Volumetric | Nuveen Intermediate vs. Commonwealth Global Fund | Nuveen Intermediate vs. Artisan Thematic Fund | Nuveen Intermediate vs. Shelton Funds |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |