Correlation Between Fidelity Series and Neuberger Berman

Can any of the company-specific risk be diversified away by investing in both Fidelity Series 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 Fidelity Series and Neuberger Berman into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Fidelity Series Government and Neuberger Berman Floating, you can compare the effects of market volatilities on Fidelity Series 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 Fidelity Series with a short position of Neuberger Berman. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Series and Neuberger Berman.

Diversification Opportunities for Fidelity Series and Neuberger Berman

0.31

Correlation Coefficient

Fidelity Series  Neuberger Berman

Weak diversification

The 3 months correlation between Fidelity and Neuberger is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Series Government and Neuberger Berman Floating in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neuberger Berman Floating and Fidelity Series 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 Fidelity Series Government 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 Floating has no effect on the direction of Fidelity Series i.e., Fidelity Series and Neuberger Berman go up and down completely randomly.

Pair Corralation between Fidelity Series and Neuberger Berman

Assuming the 90 days horizon Fidelity Series Government is expected to generate 2.22 times more return on investment than Neuberger Berman. However, Fidelity Series is 2.22 times more volatile than Neuberger Berman Floating. It trades about 0.13 of its potential returns per unit of risk. Neuberger Berman Floating is currently generating about 0.07 per unit of risk. If you would invest  893.00  in Fidelity Series Government on December 25, 2024 and sell it today you would earn a total of  20.00  from holding Fidelity Series Government or generate 2.24% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Fidelity Series Government  vs.  Neuberger Berman Floating

Fidelity Series Gove

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Series Government are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Fidelity Series is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Neuberger Berman Floating

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Neuberger Berman Floating are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Neuberger Berman is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Fidelity Series and Neuberger Berman

The main advantage of trading using opposite Fidelity Series and Neuberger Berman positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Series 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 Fidelity Series Government and Neuberger Berman Floating 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.