Correlation Between Aig Government and Neuberger Berman
Can any of the company-specific risk be diversified away by investing in both Aig Government 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 Aig Government and Neuberger Berman into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aig Government Money and Neuberger Berman Guardian, you can compare the effects of market volatilities on Aig Government 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 Aig Government with a short position of Neuberger Berman. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aig Government and Neuberger Berman.
Diversification Opportunities for Aig Government and Neuberger Berman
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aig and Neuberger is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Aig Government Money and Neuberger Berman Guardian in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neuberger Berman Guardian and Aig Government 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 Aig Government Money 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 Guardian has no effect on the direction of Aig Government i.e., Aig Government and Neuberger Berman go up and down completely randomly.
Pair Corralation between Aig Government and Neuberger Berman
Assuming the 90 days horizon Aig Government is expected to generate 3.28 times less return on investment than Neuberger Berman. But when comparing it to its historical volatility, Aig Government Money is 6.77 times less risky than Neuberger Berman. It trades about 0.11 of its potential returns per unit of risk. Neuberger Berman Guardian is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 2,988 in Neuberger Berman Guardian on October 25, 2024 and sell it today you would earn a total of 27.00 from holding Neuberger Berman Guardian or generate 0.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aig Government Money vs. Neuberger Berman Guardian
Performance |
| Timeline |
| Aig Government Money |
| Neuberger Berman Guardian |
Aig Government and Neuberger Berman Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aig Government and Neuberger Berman
The main advantage of trading using opposite Aig Government and Neuberger Berman positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aig Government 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.| Aig Government vs. Virtus Seix Government | Aig Government vs. Alpine Ultra Short | Aig Government vs. Old Westbury Municipal | Aig Government vs. Intermediate Term Tax Free Bond |
| Neuberger Berman vs. John Hancock Money | Neuberger Berman vs. Elfun Government Money | Neuberger Berman vs. Hsbc Treasury Money | Neuberger Berman vs. Aig Government 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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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