Correlation Between Sterling Capital and Neuberger Berman
Can any of the company-specific risk be diversified away by investing in both Sterling Capital 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 Sterling Capital and Neuberger Berman into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sterling Capital Total and Neuberger Berman Strategic, you can compare the effects of market volatilities on Sterling Capital 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 Sterling Capital with a short position of Neuberger Berman. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sterling Capital and Neuberger Berman.
Diversification Opportunities for Sterling Capital and Neuberger Berman
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Sterling and Neuberger is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Sterling Capital Total and Neuberger Berman Strategic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neuberger Berman Str and Sterling Capital 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 Sterling Capital Total 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 Str has no effect on the direction of Sterling Capital i.e., Sterling Capital and Neuberger Berman go up and down completely randomly.
Pair Corralation between Sterling Capital and Neuberger Berman
Assuming the 90 days horizon Sterling Capital is expected to generate 1.58 times less return on investment than Neuberger Berman. In addition to that, Sterling Capital is 1.23 times more volatile than Neuberger Berman Strategic. It trades about 0.04 of its total potential returns per unit of risk. Neuberger Berman Strategic is currently generating about 0.07 per unit of volatility. If you would invest 893.00 in Neuberger Berman Strategic on August 31, 2024 and sell it today you would earn a total of 103.00 from holding Neuberger Berman Strategic or generate 11.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sterling Capital Total vs. Neuberger Berman Strategic
Performance |
| Timeline |
| Sterling Capital Total |
| Neuberger Berman Str |
Sterling Capital and Neuberger Berman Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sterling Capital and Neuberger Berman
The main advantage of trading using opposite Sterling Capital and Neuberger Berman positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sterling Capital 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.| Sterling Capital vs. T Rowe Price | Sterling Capital vs. Nuveen Minnesota Municipal | Sterling Capital vs. Transamerica Funds | Sterling Capital vs. Blrc Sgy Mnp |
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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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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