Correlation Between Johnson Institutional and Nuveen Floating

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

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

Diversification Opportunities for Johnson Institutional and Nuveen Floating

0.93

Correlation Coefficient

Johnson Institutional  Nuveen Floating

Almost no diversification

The 3 months correlation between Johnson and Nuveen is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Johnson Institutional Short and Nuveen Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Floating Rate and Johnson Institutional 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 Johnson Institutional Short are associated (or correlated) with Nuveen Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Floating Rate has no effect on the direction of Johnson Institutional i.e., Johnson Institutional and Nuveen Floating go up and down completely randomly.

Pair Corralation between Johnson Institutional and Nuveen Floating

Assuming the 90 days horizon Johnson Institutional is expected to generate 5.9 times less return on investment than Nuveen Floating. But when comparing it to its historical volatility, Johnson Institutional Short is 3.02 times less risky than Nuveen Floating. It trades about 0.17 of its potential returns per unit of risk. Nuveen Floating Rate is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest  798.00  in Nuveen Floating Rate on May 7, 2025 and sell it today you would earn a total of  51.00  from holding Nuveen Floating Rate or generate 6.39% return on investment over 90 days.

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

Johnson Institutional Short  vs.  Nuveen Floating Rate

Johnson Institutional

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Johnson Institutional Short are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Johnson Institutional is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Nuveen Floating Rate

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Nuveen Floating Rate are ranked lower than 26 (%) of all funds and portfolios of funds over the last 90 days. Even with relatively weak technical and fundamental indicators, Nuveen Floating may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Johnson Institutional and Nuveen Floating

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

The idea behind Johnson Institutional Short and Nuveen Floating Rate 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.