Correlation Between Neuberger Berman and Emerald Insights
Can any of the company-specific risk be diversified away by investing in both Neuberger Berman and Emerald Insights 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 Emerald Insights into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Neuberger Berman Income and Emerald Insights Fund, you can compare the effects of market volatilities on Neuberger Berman and Emerald Insights 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 Emerald Insights. Check out your portfolio center. Please also check ongoing floating volatility patterns of Neuberger Berman and Emerald Insights.
Diversification Opportunities for Neuberger Berman and Emerald Insights
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Neuberger and Emerald is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Neuberger Berman Income and Emerald Insights Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emerald Insights 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 Income are associated (or correlated) with Emerald Insights. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emerald Insights has no effect on the direction of Neuberger Berman i.e., Neuberger Berman and Emerald Insights go up and down completely randomly.
Pair Corralation between Neuberger Berman and Emerald Insights
Assuming the 90 days horizon Neuberger Berman is expected to generate 2.02 times less return on investment than Emerald Insights. But when comparing it to its historical volatility, Neuberger Berman Income is 4.07 times less risky than Emerald Insights. It trades about 0.16 of its potential returns per unit of risk. Emerald Insights Fund is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,699 in Emerald Insights Fund on September 12, 2024 and sell it today you would earn a total of 562.00 from holding Emerald Insights Fund or generate 33.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.72% |
| Values | Daily Returns |
Neuberger Berman Income vs. Emerald Insights Fund
Performance |
| Timeline |
| Neuberger Berman Income |
| Emerald Insights |
Neuberger Berman and Emerald Insights Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Neuberger Berman and Emerald Insights
The main advantage of trading using opposite Neuberger Berman and Emerald Insights positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Neuberger Berman position performs unexpectedly, Emerald Insights 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 Emerald Insights will offset losses from the drop in Emerald Insights' long position.| Neuberger Berman vs. Vanguard High Yield Corporate | Neuberger Berman vs. Vanguard High Yield Porate | Neuberger Berman vs. Blackrock Hi Yld | Neuberger Berman vs. Blackrock High Yield |
| Emerald Insights vs. City National Rochdale | Emerald Insights vs. Blackrock High Yield | Emerald Insights vs. Neuberger Berman Income | Emerald Insights vs. Guggenheim High Yield |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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