Correlation Between Western Asset and Nuveen Real

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

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

Diversification Opportunities for Western Asset and Nuveen Real

0.84

Correlation Coefficient

Western Asset  Nuveen Real

Very poor diversification

The 3 months correlation between Western and Nuveen is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Western Asset Global and Nuveen Real Asset in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Real Asset and Western Asset 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 Western Asset Global are associated (or correlated) with Nuveen Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Real Asset has no effect on the direction of Western Asset i.e., Western Asset and Nuveen Real go up and down completely randomly.

Pair Corralation between Western Asset and Nuveen Real

Considering the 90-day investment horizon Western Asset Global is expected to generate 0.63 times more return on investment than Nuveen Real. However, Western Asset Global is 1.58 times less risky than Nuveen Real. It trades about 0.26 of its potential returns per unit of risk. Nuveen Real Asset is currently generating about 0.12 per unit of risk. If you would invest  618.00  in Western Asset Global on May 7, 2025 and sell it today you would earn a total of  41.00  from holding Western Asset Global or generate 6.63% return on investment over 90 days.

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

Western Asset Global  vs.  Nuveen Real Asset

Western Asset Global

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Western Asset Global are ranked lower than 20 (%) of all funds and portfolios of funds over the last 90 days. Despite fairly weak technical indicators, Western Asset may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Nuveen Real Asset

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Nuveen Real Asset are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. Despite fairly strong basic indicators, Nuveen Real is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Western Asset and Nuveen Real

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

The idea behind Western Asset Global and Nuveen Real Asset 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.