Correlation Between Active Portfolios and Nuveen Symphony

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

By analyzing existing cross correlation between Active Portfolios Multi Manager and Nuveen Symphony Floating, you can compare the effects of market volatilities on Active Portfolios and Nuveen Symphony 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 Active Portfolios with a short position of Nuveen Symphony. Check out your portfolio center. Please also check ongoing floating volatility patterns of Active Portfolios and Nuveen Symphony.

Diversification Opportunities for Active Portfolios and Nuveen Symphony

-0.61

Correlation Coefficient

Active Portfolios  Nuveen Symphony

Excellent diversification

The 3 months correlation between Active and Nuveen is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Active Portfolios Multi Manage and Nuveen Symphony Floating in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Symphony Floating and Active Portfolios 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 Active Portfolios Multi Manager are associated (or correlated) with Nuveen Symphony. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Symphony Floating has no effect on the direction of Active Portfolios i.e., Active Portfolios and Nuveen Symphony go up and down completely randomly.

Pair Corralation between Active Portfolios and Nuveen Symphony

Assuming the 90 days horizon Active Portfolios Multi Manager is expected to under-perform the Nuveen Symphony. In addition to that, Active Portfolios is 1.98 times more volatile than Nuveen Symphony Floating. It trades about -0.32 of its total potential returns per unit of risk. Nuveen Symphony Floating is currently generating about 0.13 per unit of volatility. If you would invest  1,813  in Nuveen Symphony Floating on September 25, 2024 and sell it today you would earn a total of  7.00  from holding Nuveen Symphony Floating or generate 0.39% return on investment over 90 days.

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

Active Portfolios Multi Manage  vs.  Nuveen Symphony Floating

Active Portfolios Multi

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Active Portfolios Multi Manager has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Active Portfolios is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Nuveen Symphony Floating

Risk-Adjusted Performance

20 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Nuveen Symphony Floating are ranked lower than 20 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Nuveen Symphony is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Active Portfolios and Nuveen Symphony

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

The idea behind Active Portfolios Multi Manager and Nuveen Symphony Floating 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.