Correlation Between Tekla Healthcare and Neuberger Berman
Can any of the company-specific risk be diversified away by investing in both Tekla Healthcare 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 Tekla Healthcare and Neuberger Berman into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tekla Healthcare Investors and Neuberger Berman Re, you can compare the effects of market volatilities on Tekla Healthcare 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 Tekla Healthcare with a short position of Neuberger Berman. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tekla Healthcare and Neuberger Berman.
Diversification Opportunities for Tekla Healthcare and Neuberger Berman
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Tekla and Neuberger is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Tekla Healthcare Investors and Neuberger Berman Re in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neuberger Berman and Tekla Healthcare 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 Tekla Healthcare Investors 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 has no effect on the direction of Tekla Healthcare i.e., Tekla Healthcare and Neuberger Berman go up and down completely randomly.
Pair Corralation between Tekla Healthcare and Neuberger Berman
Considering the 90-day investment horizon Tekla Healthcare is expected to generate 1.98 times less return on investment than Neuberger Berman. But when comparing it to its historical volatility, Tekla Healthcare Investors is 1.33 times less risky than Neuberger Berman. It trades about 0.08 of its potential returns per unit of risk. Neuberger Berman Re is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 241.00 in Neuberger Berman Re on September 4, 2024 and sell it today you would earn a total of 141.00 from holding Neuberger Berman Re or generate 58.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tekla Healthcare Investors vs. Neuberger Berman Re
Performance |
| Timeline |
| Tekla Healthcare Inv |
| Neuberger Berman |
Tekla Healthcare and Neuberger Berman Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tekla Healthcare and Neuberger Berman
The main advantage of trading using opposite Tekla Healthcare and Neuberger Berman positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tekla Healthcare 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.| Tekla Healthcare vs. Tekla Healthcare Opportunities | Tekla Healthcare vs. Eaton Vance Tax | Tekla Healthcare vs. Tekla World Healthcare | Tekla Healthcare vs. Cohen Steers Limited |
| Neuberger Berman vs. Nuveen Multi Mrkt | Neuberger Berman vs. Neuberger Berman Next | Neuberger Berman vs. Pgim High Yield | Neuberger Berman vs. Aberdeen Global Premier |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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