Correlation Between Virtus AllianzGI and Neuberger Berman

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

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

Diversification Opportunities for Virtus AllianzGI and Neuberger Berman

0.81

Correlation Coefficient

Virtus AllianzGI  Neuberger Berman

Very poor diversification

The 3 months correlation between Virtus and Neuberger is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Virtus AllianzGI Convertible and Neuberger Berman High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neuberger Berman High and Virtus AllianzGI 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 Virtus AllianzGI Convertible 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 High has no effect on the direction of Virtus AllianzGI i.e., Virtus AllianzGI and Neuberger Berman go up and down completely randomly.

Pair Corralation between Virtus AllianzGI and Neuberger Berman

Assuming the 90 days trading horizon Virtus AllianzGI Convertible is expected to generate 0.97 times more return on investment than Neuberger Berman. However, Virtus AllianzGI Convertible is 1.03 times less risky than Neuberger Berman. It trades about 0.15 of its potential returns per unit of risk. Neuberger Berman High is currently generating about 0.14 per unit of risk. If you would invest  2,094  in Virtus AllianzGI Convertible on December 23, 2024 and sell it today you would earn a total of  118.00  from holding Virtus AllianzGI Convertible or generate 5.64% return on investment over 90 days.

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

Virtus AllianzGI Convertible  vs.  Neuberger Berman High

Virtus AllianzGI Con

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Virtus AllianzGI Convertible are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Virtus AllianzGI is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Neuberger Berman High

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Neuberger Berman High are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of comparatively stable technical indicators, Neuberger Berman is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Virtus AllianzGI and Neuberger Berman

The main advantage of trading using opposite Virtus AllianzGI and Neuberger Berman positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus AllianzGI 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 Virtus AllianzGI Convertible and Neuberger Berman High 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 Global Correlations module to find global opportunities by holding instruments from different markets.