Correlation Between Neuberger Berman and Vela Large
Can any of the company-specific risk be diversified away by investing in both Neuberger Berman and Vela Large 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 Vela Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Neuberger Berman High and Vela Large Cap, you can compare the effects of market volatilities on Neuberger Berman and Vela Large 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 Vela Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Neuberger Berman and Vela Large.
Diversification Opportunities for Neuberger Berman and Vela Large
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Neuberger and VELA is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Neuberger Berman High and Vela Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vela Large Cap 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 High are associated (or correlated) with Vela Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vela Large Cap has no effect on the direction of Neuberger Berman i.e., Neuberger Berman and Vela Large go up and down completely randomly.
Pair Corralation between Neuberger Berman and Vela Large
Considering the 90-day investment horizon Neuberger Berman is expected to generate 1.9 times less return on investment than Vela Large. In addition to that, Neuberger Berman is 1.72 times more volatile than Vela Large Cap. It trades about 0.05 of its total potential returns per unit of risk. Vela Large Cap is currently generating about 0.15 per unit of volatility. If you would invest 1,651 in Vela Large Cap on September 3, 2024 and sell it today you would earn a total of 168.00 from holding Vela Large Cap or generate 10.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Neuberger Berman High vs. Vela Large Cap
Performance |
| Timeline |
| Neuberger Berman High |
| Vela Large Cap |
Neuberger Berman and Vela Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Neuberger Berman and Vela Large
The main advantage of trading using opposite Neuberger Berman and Vela Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Neuberger Berman position performs unexpectedly, Vela Large 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 Vela Large will offset losses from the drop in Vela Large's long position.| Neuberger Berman vs. Invesco High Income | Neuberger Berman vs. Alliancebernstein National Municipal | Neuberger Berman vs. Pioneer Diversified High | Neuberger Berman vs. Highland Floating Rate |
| Vela Large vs. Matson Money Equity | Vela Large vs. Prudential Government Money | Vela Large vs. John Hancock Money | Vela Large vs. Schwab Treasury Money |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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