Correlation Between Neuberger Berman and Campbell Systematic

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

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

Diversification Opportunities for Neuberger Berman and Campbell Systematic

0.17

Correlation Coefficient

Neuberger Berman Campbell Systematic

Average diversification

The 3 months correlation between Neuberger and Campbell is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Neuberger Berman Intermediate and Campbell Systematic Macro in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Campbell Systematic Macro 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 Intermediate are associated (or correlated) with Campbell Systematic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Campbell Systematic Macro has no effect on the direction of Neuberger Berman i.e., Neuberger Berman and Campbell Systematic go up and down completely randomly.

Pair Corralation between Neuberger Berman and Campbell Systematic

Assuming the 90 days horizon Neuberger Berman Intermediate is expected to under-perform the Campbell Systematic. But the mutual fund apears to be less risky and, when comparing its historical volatility, Neuberger Berman Intermediate is 1.55 times less risky than Campbell Systematic. The mutual fund trades about -0.03 of its potential returns per unit of risk. The Campbell Systematic Macro is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  927.00  in Campbell Systematic Macro on March 10, 2023 and sell it today you would earn a total of  28.00  from holding Campbell Systematic Macro or generate 3.02% return on investment over 90 days.

Neuberger Berman Intermediate  vs.  Campbell Systematic Macro

Neuberger Berman Int

Neuberger Performance

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Over the last 90 days Neuberger Berman Intermediate has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical indicators, Neuberger Berman is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Campbell Systematic Macro

Campbell Performance

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Over the last 90 days Campbell Systematic Macro has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest uncertain performance, the Fund's basic 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 Campbell Systematic

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

The idea behind Neuberger Berman Intermediate and Campbell Systematic Macro 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.

Check out your portfolio center. 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.