Correlation Between Aig Government and Nuveen Short-duration
Can any of the company-specific risk be diversified away by investing in both Aig Government and Nuveen Short-duration 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 Aig Government and Nuveen Short-duration into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aig Government Money and Nuveen Short Duration High, you can compare the effects of market volatilities on Aig Government and Nuveen Short-duration 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 Aig Government with a short position of Nuveen Short-duration. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aig Government and Nuveen Short-duration.
Diversification Opportunities for Aig Government and Nuveen Short-duration
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Aig and Nuveen is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Aig Government Money and Nuveen Short Duration High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Short Duration and Aig Government 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 Aig Government Money are associated (or correlated) with Nuveen Short-duration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Short Duration has no effect on the direction of Aig Government i.e., Aig Government and Nuveen Short-duration go up and down completely randomly.
Pair Corralation between Aig Government and Nuveen Short-duration
Assuming the 90 days horizon Aig Government Money is expected to under-perform the Nuveen Short-duration. In addition to that, Aig Government is 1.13 times more volatile than Nuveen Short Duration High. It trades about -0.01 of its total potential returns per unit of risk. Nuveen Short Duration High is currently generating about 0.04 per unit of volatility. If you would invest 953.00 in Nuveen Short Duration High on December 27, 2024 and sell it today you would earn a total of 4.00 from holding Nuveen Short Duration High or generate 0.42% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Aig Government Money vs. Nuveen Short Duration High
Performance |
Timeline |
Aig Government Money |
Nuveen Short Duration |
Aig Government and Nuveen Short-duration Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Aig Government and Nuveen Short-duration
The main advantage of trading using opposite Aig Government and Nuveen Short-duration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aig Government position performs unexpectedly, Nuveen Short-duration 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 Short-duration will offset losses from the drop in Nuveen Short-duration's long position.Aig Government vs. Blackrock Health Sciences | Aig Government vs. Alphacentric Lifesci Healthcare | Aig Government vs. Baillie Gifford Health | Aig Government vs. Schwab Health Care |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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