Correlation Between Nuveen Real and Falcon Focus

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

By analyzing existing cross correlation between Nuveen Real Estate and Falcon Focus Scv, you can compare the effects of market volatilities on Nuveen Real and Falcon Focus 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 Nuveen Real with a short position of Falcon Focus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Real and Falcon Focus.

Diversification Opportunities for Nuveen Real and Falcon Focus

0.0

Correlation Coefficient

Nuveen Real  Falcon Focus

Pay attention - limited upside

The 3 months correlation between Nuveen and Falcon is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Real Estate and Falcon Focus Scv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Falcon Focus Scv and Nuveen Real 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 Nuveen Real Estate are associated (or correlated) with Falcon Focus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Falcon Focus Scv has no effect on the direction of Nuveen Real i.e., Nuveen Real and Falcon Focus go up and down completely randomly.

Pair Corralation between Nuveen Real and Falcon Focus

Assuming the 90 days horizon Nuveen Real is expected to generate 2.33 times less return on investment than Falcon Focus. In addition to that, Nuveen Real is 1.42 times more volatile than Falcon Focus Scv. It trades about 0.03 of its total potential returns per unit of risk. Falcon Focus Scv is currently generating about 0.1 per unit of volatility. If you would invest  905.00  in Falcon Focus Scv on September 20, 2024 and sell it today you would earn a total of  410.00  from holding Falcon Focus Scv or generate 45.3% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

Nuveen Real Estate  vs.  Falcon Focus Scv

Nuveen Real Estate

Risk-Adjusted Performance

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Very Weak

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

Falcon Focus Scv

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Nuveen Real and Falcon Focus

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

The idea behind Nuveen Real Estate and Falcon Focus Scv 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.