Correlation Between Neuberger Berman and Salient International
Can any of the company-specific risk be diversified away by investing in both Neuberger Berman and Salient International 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 Salient International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Neuberger Berman Intermediate and Salient International Real, you can compare the effects of market volatilities on Neuberger Berman and Salient International 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 Salient International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Neuberger Berman and Salient International.
Diversification Opportunities for Neuberger Berman and Salient International
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Neuberger and Salient is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Neuberger Berman Intermediate and Salient International Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Salient International 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 Intermediate are associated (or correlated) with Salient International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Salient International has no effect on the direction of Neuberger Berman i.e., Neuberger Berman and Salient International go up and down completely randomly.
Pair Corralation between Neuberger Berman and Salient International
Assuming the 90 days horizon Neuberger Berman Intermediate is expected to generate 0.53 times more return on investment than Salient International. However, Neuberger Berman Intermediate is 1.9 times less risky than Salient International. It trades about -0.07 of its potential returns per unit of risk. Salient International Real is currently generating about -0.09 per unit of risk. If you would invest 1,195 in Neuberger Berman Intermediate on November 18, 2024 and sell it today you would lose (19.00) from holding Neuberger Berman Intermediate or give up 1.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Neuberger Berman Intermediate vs. Salient International Real
Performance |
| Timeline |
| Neuberger Berman Int |
| Salient International |
Neuberger Berman and Salient International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Neuberger Berman and Salient International
The main advantage of trading using opposite Neuberger Berman and Salient International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Neuberger Berman position performs unexpectedly, Salient International 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 Salient International will offset losses from the drop in Salient International's long position.| Neuberger Berman vs. Old Westbury California | Neuberger Berman vs. Franklin Adjustable Government | Neuberger Berman vs. Baird Quality Intermediate | Neuberger Berman vs. Us Government Securities |
| Salient International vs. Virtus Seix Government | Salient International vs. Wesmark Government Bond | Salient International vs. Payden Government Fund | Salient International vs. Us Government Securities |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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