Correlation Between Nuveen Preferred and 13d Activist

Can any of the company-specific risk be diversified away by investing in both Nuveen Preferred and 13d Activist 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 Preferred and 13d Activist into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Nuveen Preferred Income and 13d Activist Fund, you can compare the effects of market volatilities on Nuveen Preferred and 13d Activist 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 Preferred with a short position of 13d Activist. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Preferred and 13d Activist.

Diversification Opportunities for Nuveen Preferred and 13d Activist

0.65

Correlation Coefficient

Nuveen Preferred  13d Activist

Poor diversification

The 3 months correlation between Nuveen and 13d is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Preferred Income and 13d Activist Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 13d Activist and Nuveen Preferred 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 Preferred Income are associated (or correlated) with 13d Activist. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 13d Activist has no effect on the direction of Nuveen Preferred i.e., Nuveen Preferred and 13d Activist go up and down completely randomly.

Pair Corralation between Nuveen Preferred and 13d Activist

Considering the 90-day investment horizon Nuveen Preferred is expected to generate 1.39 times less return on investment than 13d Activist. But when comparing it to its historical volatility, Nuveen Preferred Income is 3.07 times less risky than 13d Activist. It trades about 0.3 of its potential returns per unit of risk. 13d Activist Fund is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  1,884  in 13d Activist Fund on May 3, 2025 and sell it today you would earn a total of  158.00  from holding 13d Activist Fund or generate 8.39% return on investment over 90 days.

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

Nuveen Preferred Income  vs.  13d Activist Fund

Nuveen Preferred Income

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Nuveen Preferred Income are ranked lower than 23 (%) of all funds and portfolios of funds over the last 90 days. In spite of rather sound basic indicators, Nuveen Preferred is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

13d Activist

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in 13d Activist Fund are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, 13d Activist may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Nuveen Preferred and 13d Activist

The main advantage of trading using opposite Nuveen Preferred and 13d Activist positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuveen Preferred position performs unexpectedly, 13d Activist 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 13d Activist will offset losses from the drop in 13d Activist's long position.

The idea behind Nuveen Preferred Income and 13d Activist Fund 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.