Correlation Between Neuberger Berman and First Trust
Can any of the company-specific risk be diversified away by investing in both Neuberger Berman and First Trust 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 First Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Neuberger Berman High and First Trust Intermediate, you can compare the effects of market volatilities on Neuberger Berman and First Trust 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 First Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Neuberger Berman and First Trust.
Diversification Opportunities for Neuberger Berman and First Trust
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Neuberger and First is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Neuberger Berman High and First Trust Intermediate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Trust Intermediate 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 High are associated (or correlated) with First Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Trust Intermediate has no effect on the direction of Neuberger Berman i.e., Neuberger Berman and First Trust go up and down completely randomly.
Pair Corralation between Neuberger Berman and First Trust
Considering the 90-day investment horizon Neuberger Berman is expected to generate 4.29 times less return on investment than First Trust. In addition to that, Neuberger Berman is 1.53 times more volatile than First Trust Intermediate. It trades about 0.06 of its total potential returns per unit of risk. First Trust Intermediate is currently generating about 0.37 per unit of volatility. If you would invest 1,698 in First Trust Intermediate on April 24, 2025 and sell it today you would earn a total of 177.00 from holding First Trust Intermediate or generate 10.42% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Neuberger Berman High vs. First Trust Intermediate
Performance |
Timeline |
Neuberger Berman High |
First Trust Intermediate |
Neuberger Berman and First Trust Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Neuberger Berman and First Trust
The main advantage of trading using opposite Neuberger Berman and First Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Neuberger Berman position performs unexpectedly, First Trust 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 First Trust will offset losses from the drop in First Trust's long position.Neuberger Berman vs. Nuveen Multi Mrkt | Neuberger Berman vs. Neuberger Berman Next | Neuberger Berman vs. Pgim High Yield | Neuberger Berman vs. Neuberger Berman Re |
First Trust vs. Franklin Templeton Limited | First Trust vs. Blackrock Floating Rate | First Trust vs. Cohen Steers Limited | First Trust vs. Nuveen Preferred and |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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