Correlation Between Akre Focus and Neuberger Berman
Can any of the company-specific risk be diversified away by investing in both Akre Focus and Neuberger Berman 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 Akre Focus and Neuberger Berman into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Akre Focus Fund and Neuberger Berman Large, you can compare the effects of market volatilities on Akre Focus and Neuberger Berman 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 Akre Focus with a short position of Neuberger Berman. Check out your portfolio center. Please also check ongoing floating volatility patterns of Akre Focus and Neuberger Berman.
Diversification Opportunities for Akre Focus and Neuberger Berman
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Akre and Neuberger is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Akre Focus Fund and Neuberger Berman Large in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neuberger Berman Large and Akre Focus 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 Akre Focus Fund are associated (or correlated) with Neuberger Berman. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neuberger Berman Large has no effect on the direction of Akre Focus i.e., Akre Focus and Neuberger Berman go up and down completely randomly.
Pair Corralation between Akre Focus and Neuberger Berman
Assuming the 90 days horizon Akre Focus Fund is expected to generate 1.32 times more return on investment than Neuberger Berman. However, Akre Focus is 1.32 times more volatile than Neuberger Berman Large. It trades about 0.09 of its potential returns per unit of risk. Neuberger Berman Large is currently generating about 0.05 per unit of risk. If you would invest 4,759 in Akre Focus Fund on September 12, 2024 and sell it today you would earn a total of 2,232 from holding Akre Focus Fund or generate 46.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Akre Focus Fund vs. Neuberger Berman Large
Performance |
| Timeline |
| Akre Focus Fund |
| Neuberger Berman Large |
Akre Focus and Neuberger Berman Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Akre Focus and Neuberger Berman
The main advantage of trading using opposite Akre Focus and Neuberger Berman positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Akre Focus position performs unexpectedly, Neuberger Berman 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 Neuberger Berman will offset losses from the drop in Neuberger Berman's long position.| Akre Focus vs. Akre Focus Fund | Akre Focus vs. Akre Focus Fund | Akre Focus vs. T Rowe Price | Akre Focus vs. Aqr Diversified Arbitrage |
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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 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.
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