Correlation Between Premier Financial and Neuberger Berman
Can any of the company-specific risk be diversified away by investing in both Premier Financial 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 Premier Financial and Neuberger Berman into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Premier Financial Corp and Neuberger Berman Next, you can compare the effects of market volatilities on Premier Financial 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 Premier Financial with a short position of Neuberger Berman. Check out your portfolio center. Please also check ongoing floating volatility patterns of Premier Financial and Neuberger Berman.
Diversification Opportunities for Premier Financial and Neuberger Berman
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Premier and Neuberger is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Premier Financial Corp and Neuberger Berman Next in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neuberger Berman Next and Premier Financial 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 Premier Financial Corp 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 Next has no effect on the direction of Premier Financial i.e., Premier Financial and Neuberger Berman go up and down completely randomly.
Pair Corralation between Premier Financial and Neuberger Berman
Considering the 90-day investment horizon Premier Financial Corp is expected to generate 6.35 times more return on investment than Neuberger Berman. However, Premier Financial is 6.35 times more volatile than Neuberger Berman Next. It trades about 0.16 of its potential returns per unit of risk. Neuberger Berman Next is currently generating about 0.44 per unit of risk. If you would invest 2,482 in Premier Financial Corp on August 31, 2024 and sell it today you would earn a total of 306.00 from holding Premier Financial Corp or generate 12.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Premier Financial Corp vs. Neuberger Berman Next
Performance |
| Timeline |
| Premier Financial Corp |
| Neuberger Berman Next |
Premier Financial and Neuberger Berman Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Premier Financial and Neuberger Berman
The main advantage of trading using opposite Premier Financial and Neuberger Berman positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Premier Financial 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.| Premier Financial vs. Bankwell Financial Group | Premier Financial vs. Middlefield Banc | Premier Financial vs. Civista Bancshares | Premier Financial vs. Primis Financial Corp |
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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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