Correlation Between Neuberger Berman and Spectrum Fund

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

By analyzing existing cross correlation between Neuberger Berman Long and Spectrum Fund Institutional, you can compare the effects of market volatilities on Neuberger Berman and Spectrum Fund 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 Spectrum Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Neuberger Berman and Spectrum Fund.

Diversification Opportunities for Neuberger Berman and Spectrum Fund

0.82

Correlation Coefficient

Neuberger Berman  Spectrum Fund

Very poor diversification

The 3 months correlation between Neuberger and Spectrum is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Neuberger Berman Long and Spectrum Fund Institutional in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spectrum Fund Instit 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 Long are associated (or correlated) with Spectrum Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spectrum Fund Instit has no effect on the direction of Neuberger Berman i.e., Neuberger Berman and Spectrum Fund go up and down completely randomly.

Pair Corralation between Neuberger Berman and Spectrum Fund

Assuming the 90 days horizon Neuberger Berman is expected to generate 3.67 times less return on investment than Spectrum Fund. But when comparing it to its historical volatility, Neuberger Berman Long is 2.28 times less risky than Spectrum Fund. It trades about 0.15 of its potential returns per unit of risk. Spectrum Fund Institutional is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest  1,331  in Spectrum Fund Institutional on May 2, 2025 and sell it today you would earn a total of  126.00  from holding Spectrum Fund Institutional or generate 9.47% return on investment over 90 days.

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

Neuberger Berman Long  vs.  Spectrum Fund Institutional

Neuberger Berman Long

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Neuberger Berman Long are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Neuberger Berman is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Spectrum Fund Instit

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Spectrum Fund Institutional are ranked lower than 18 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Spectrum Fund may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Neuberger Berman and Spectrum Fund

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

The idea behind Neuberger Berman Long and Spectrum Fund Institutional 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.