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 Allocation and Neuberger Berman Mlp, 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

-0.17

Correlation Coefficient

Clough Global  Neuberger Berman

Good diversification

The 3 months correlation between Clough and Neuberger is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Clough Global Allocation and Neuberger Berman Mlp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neuberger Berman Mlp 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 Allocation 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 Mlp 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 is expected to generate 4.86 times less return on investment than Neuberger Berman. But when comparing it to its historical volatility, Clough Global Allocation is 1.43 times less risky than Neuberger Berman. It trades about 0.02 of its potential returns per unit of risk. Neuberger Berman Mlp is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  586.00  in Neuberger Berman Mlp on October 9, 2024 and sell it today you would earn a total of  306.00  from holding Neuberger Berman Mlp or generate 52.22% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

Clough Global Allocation  vs.  Neuberger Berman Mlp

Clough Global Allocation

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Clough Global Allocation has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly stable essential indicators, Clough Global is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Neuberger Berman Mlp

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Neuberger Berman Mlp are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. Despite quite weak primary indicators, Neuberger Berman may actually be approaching a critical reversion point that can send shares even higher in February 2025.

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 Allocation and Neuberger Berman Mlp 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.