Correlation Between Nuveen Minnesota and Lord Abbett
Can any of the company-specific risk be diversified away by investing in both Nuveen Minnesota and Lord Abbett 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 Minnesota and Lord Abbett into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nuveen Minnesota Municipal and Lord Abbett Small, you can compare the effects of market volatilities on Nuveen Minnesota and Lord Abbett 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 Minnesota with a short position of Lord Abbett. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Minnesota and Lord Abbett.
Diversification Opportunities for Nuveen Minnesota and Lord Abbett
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Nuveen and Lord is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Minnesota Municipal and Lord Abbett Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lord Abbett Small and Nuveen Minnesota 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 Minnesota Municipal are associated (or correlated) with Lord Abbett. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lord Abbett Small has no effect on the direction of Nuveen Minnesota i.e., Nuveen Minnesota and Lord Abbett go up and down completely randomly.
Pair Corralation between Nuveen Minnesota and Lord Abbett
Assuming the 90 days horizon Nuveen Minnesota is expected to generate 3.42 times less return on investment than Lord Abbett. But when comparing it to its historical volatility, Nuveen Minnesota Municipal is 7.25 times less risky than Lord Abbett. It trades about 0.05 of its potential returns per unit of risk. Lord Abbett Small is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 2,083 in Lord Abbett Small on September 28, 2024 and sell it today you would earn a total of 66.00 from holding Lord Abbett Small or generate 3.17% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Nuveen Minnesota Municipal vs. Lord Abbett Small
Performance |
Timeline |
Nuveen Minnesota Mun |
Lord Abbett Small |
Nuveen Minnesota and Lord Abbett Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Nuveen Minnesota and Lord Abbett
The main advantage of trading using opposite Nuveen Minnesota and Lord Abbett positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuveen Minnesota position performs unexpectedly, Lord Abbett 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 Lord Abbett will offset losses from the drop in Lord Abbett's long position.Nuveen Minnesota vs. Guidemark E Fixed | Nuveen Minnesota vs. Cutler Equity | Nuveen Minnesota vs. Dreyfusnewton International Equity | Nuveen Minnesota vs. Gmo Global Equity |
Lord Abbett vs. Lord Abbett Trust | Lord Abbett vs. Lord Abbett Trust | Lord Abbett vs. Lord Abbett Focused | Lord Abbett vs. Floating Rate Fund |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
Stocks Directory Find actively traded stocks across global markets | |
Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges |