Correlation Between Neuberger Berman and Artisan International

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

By analyzing existing cross correlation between Neuberger Berman Focus and Artisan International Fund, you can compare the effects of market volatilities on Neuberger Berman and Artisan 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 Artisan International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Neuberger Berman and Artisan International.

Diversification Opportunities for Neuberger Berman and Artisan International

-0.36

Correlation Coefficient

Neuberger Berman  Artisan International

Very good diversification

The 3 months correlation between Neuberger and Artisan is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Neuberger Berman Focus and Artisan International Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artisan 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 Focus are associated (or correlated) with Artisan International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Artisan International has no effect on the direction of Neuberger Berman i.e., Neuberger Berman and Artisan International go up and down completely randomly.

Pair Corralation between Neuberger Berman and Artisan International

Assuming the 90 days horizon Neuberger Berman Focus is expected to generate 0.52 times more return on investment than Artisan International. However, Neuberger Berman Focus is 1.92 times less risky than Artisan International. It trades about 0.13 of its potential returns per unit of risk. Artisan International Fund is currently generating about -0.12 per unit of risk. If you would invest  2,944  in Neuberger Berman Focus on September 15, 2024 and sell it today you would earn a total of  177.00  from holding Neuberger Berman Focus or generate 6.01% return on investment over 90 days.

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

Neuberger Berman Focus  vs.  Artisan International Fund

Neuberger Berman Focus

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Neuberger Berman Focus are ranked lower than 10 (%) 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.

Artisan International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Artisan International Fund 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.

Pair Trading with Neuberger Berman and Artisan International

The main advantage of trading using opposite Neuberger Berman and Artisan International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Neuberger Berman position performs unexpectedly, Artisan 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 Artisan International will offset losses from the drop in Artisan International's long position.

The idea behind Neuberger Berman Focus and Artisan International Fund 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.