Correlation Between Clough Global and Neuberger Berman

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

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

Diversification Opportunities for Clough Global and Neuberger Berman

0.88

Correlation Coefficient

Clough Global  Neuberger Berman

Very poor diversification

The 3 months correlation between Clough and Neuberger is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Clough Global Ef 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 Clough Global 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 Clough Global Ef 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 Clough Global i.e., Clough Global and Neuberger Berman go up and down completely randomly.

Pair Corralation between Clough Global and Neuberger Berman

Considering the 90-day investment horizon Clough Global Ef is expected to under-perform the Neuberger Berman. But the fund apears to be less risky and, when comparing its historical volatility, Clough Global Ef is 1.51 times less risky than Neuberger Berman. The fund trades about -0.03 of its potential returns per unit of risk. The Neuberger Berman Next is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  1,248  in Neuberger Berman Next on December 29, 2024 and sell it today you would earn a total of  8.00  from holding Neuberger Berman Next or generate 0.64% return on investment over 90 days.

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

Clough Global Ef  vs.  Neuberger Berman Next

Clough Global Ef

Risk-Adjusted Performance

Very Weak

Over the last 90 days Clough Global Ef has generated negative risk-adjusted returns adding no value to fund investors. Even with relatively invariable essential indicators, Clough Global is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Neuberger Berman Next

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Neuberger Berman Next are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Neuberger Berman is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Clough Global and Neuberger Berman

The main advantage of trading using opposite Clough Global and Neuberger Berman positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clough Global 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 Clough Global Ef and Neuberger Berman Next 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.