Correlation Between Neuberger Berman and Advisors Capital

Can any of the company-specific risk be diversified away by investing in both Neuberger Berman and Advisors Capital 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 Neuberger Berman and Advisors Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Neuberger Berman International and Advisors Capital Tactical, you can compare the effects of market volatilities on Neuberger Berman and Advisors Capital 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 Neuberger Berman with a short position of Advisors Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Neuberger Berman and Advisors Capital.

Diversification Opportunities for Neuberger Berman and Advisors Capital

0.76

Correlation Coefficient

Neuberger Berman  Advisors Capital

Poor diversification

The 3 months correlation between Neuberger and Advisors is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Neuberger Berman International and Advisors Capital Tactical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advisors Capital Tactical and Neuberger Berman 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 Neuberger Berman International are associated (or correlated) with Advisors Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advisors Capital Tactical has no effect on the direction of Neuberger Berman i.e., Neuberger Berman and Advisors Capital go up and down completely randomly.

Pair Corralation between Neuberger Berman and Advisors Capital

Assuming the 90 days horizon Neuberger Berman International is expected to under-perform the Advisors Capital. In addition to that, Neuberger Berman is 3.81 times more volatile than Advisors Capital Tactical. It trades about -0.02 of its total potential returns per unit of risk. Advisors Capital Tactical is currently generating about 0.05 per unit of volatility. If you would invest  959.00  in Advisors Capital Tactical on May 2, 2025 and sell it today you would earn a total of  2.00  from holding Advisors Capital Tactical or generate 0.21% return on investment over 90 days.

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

Neuberger Berman International  vs.  Advisors Capital Tactical

Neuberger Berman Int

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Neuberger Berman International are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Neuberger Berman is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Advisors Capital Tactical

Risk-Adjusted Performance

Good

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

Pair Trading with Neuberger Berman and Advisors Capital

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

The idea behind Neuberger Berman International and Advisors Capital Tactical 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.