Correlation Between Credit Suisse and Neuberger Berman

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Can any of the company-specific risk be diversified away by investing in both Credit Suisse 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 Credit Suisse and Neuberger Berman into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Credit Suisse Multialternative and Neuberger Berman International, you can compare the effects of market volatilities on Credit Suisse 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 Credit Suisse with a short position of Neuberger Berman. Check out your portfolio center. Please also check ongoing floating volatility patterns of Credit Suisse and Neuberger Berman.

Diversification Opportunities for Credit Suisse and Neuberger Berman

0.77
  Correlation Coefficient

Poor diversification

The 3 months correlation between Credit and Neuberger is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Credit Suisse Multialternative and Neuberger Berman International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neuberger Berman Int and Credit Suisse 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 Credit Suisse Multialternative 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 Int has no effect on the direction of Credit Suisse i.e., Credit Suisse and Neuberger Berman go up and down completely randomly.

Pair Corralation between Credit Suisse and Neuberger Berman

Assuming the 90 days horizon Credit Suisse Multialternative is expected to under-perform the Neuberger Berman. In addition to that, Credit Suisse is 2.33 times more volatile than Neuberger Berman International. It trades about -0.21 of its total potential returns per unit of risk. Neuberger Berman International is currently generating about -0.33 per unit of volatility. If you would invest  1,370  in Neuberger Berman International on October 10, 2024 and sell it today you would lose (108.00) from holding Neuberger Berman International or give up 7.88% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Credit Suisse Multialternative  vs.  Neuberger Berman International

 Performance 
       Timeline  
Credit Suisse Multia 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Credit Suisse Multialternative has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's forward indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.
Neuberger Berman Int 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Neuberger Berman International has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Credit Suisse and Neuberger Berman Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Credit Suisse and Neuberger Berman

The main advantage of trading using opposite Credit Suisse and Neuberger Berman positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Credit Suisse 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.
The idea behind Credit Suisse Multialternative and Neuberger Berman International pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.

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