Correlation Between Eaton Vance and Nuveen Symphony

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

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

Diversification Opportunities for Eaton Vance and Nuveen Symphony

0.99

Correlation Coefficient

Eaton Vance  Nuveen Symphony

No risk reduction

The 3 months correlation between Eaton and Nuveen is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Eaton Vance Floating Rate 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 Eaton Vance 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 Eaton Vance Floating Rate 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 Eaton Vance i.e., Eaton Vance and Nuveen Symphony go up and down completely randomly.

Pair Corralation between Eaton Vance and Nuveen Symphony

Assuming the 90 days horizon Eaton Vance Floating Rate is expected to generate 1.1 times more return on investment than Nuveen Symphony. However, Eaton Vance is 1.1 times more volatile than Nuveen Symphony Floating. It trades about 0.21 of its potential returns per unit of risk. Nuveen Symphony Floating is currently generating about 0.22 per unit of risk. If you would invest  818.00  in Eaton Vance Floating Rate on September 3, 2024 and sell it today you would earn a total of  186.00  from holding Eaton Vance Floating Rate or generate 22.74% return on investment over 90 days.

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

Eaton Vance Floating Rate  vs.  Nuveen Symphony Floating

Eaton Vance Floating

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Eaton Vance Floating Rate are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Eaton Vance 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 Eaton Vance and Nuveen Symphony

The main advantage of trading using opposite Eaton Vance and Nuveen Symphony positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eaton Vance 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 Eaton Vance Floating Rate 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.

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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.