Correlation Between Neuberger Berman and Financial Services

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

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

Diversification Opportunities for Neuberger Berman and Financial Services

0.0

Correlation Coefficient

Neuberger Berman  Financial Services

Pay attention - limited upside

The 3 months correlation between Neuberger and Financial is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Neuberger Berman Large and Financial Services Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Financial Services 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 Large are associated (or correlated) with Financial Services. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Financial Services has no effect on the direction of Neuberger Berman i.e., Neuberger Berman and Financial Services go up and down completely randomly.

Pair Corralation between Neuberger Berman and Financial Services

If you would invest (100.00) in Financial Services Fund on February 3, 2025 and sell it today you would earn a total of  100.00  from holding Financial Services Fund or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Neuberger Berman Large  vs.  Financial Services Fund

Neuberger Berman Large

Risk-Adjusted Performance

Very Weak

Over the last 90 days Neuberger Berman Large has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical and 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.

Financial Services

Risk-Adjusted Performance

Very Weak

Over the last 90 days Financial Services Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Financial Services 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 Financial Services

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

The idea behind Neuberger Berman Large and Financial Services 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.