Correlation Between Bbh Limited and First Eagle
Can any of the company-specific risk be diversified away by investing in both Bbh Limited and First Eagle 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 Bbh Limited and First Eagle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bbh Limited Duration and First Eagle Overseas, you can compare the effects of market volatilities on Bbh Limited and First Eagle 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 Bbh Limited with a short position of First Eagle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bbh Limited and First Eagle.
Diversification Opportunities for Bbh Limited and First Eagle
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bbh and First is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Bbh Limited Duration and First Eagle Overseas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Eagle Overseas and Bbh Limited 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 Bbh Limited Duration are associated (or correlated) with First Eagle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Eagle Overseas has no effect on the direction of Bbh Limited i.e., Bbh Limited and First Eagle go up and down completely randomly.
Pair Corralation between Bbh Limited and First Eagle
Assuming the 90 days horizon Bbh Limited is expected to generate 1.54 times less return on investment than First Eagle. But when comparing it to its historical volatility, Bbh Limited Duration is 6.26 times less risky than First Eagle. It trades about 0.26 of its potential returns per unit of risk. First Eagle Overseas is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 2,265 in First Eagle Overseas on September 3, 2024 and sell it today you would earn a total of 481.00 from holding First Eagle Overseas or generate 21.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bbh Limited Duration vs. First Eagle Overseas
Performance |
| Timeline |
| Bbh Limited Duration |
| First Eagle Overseas |
Bbh Limited and First Eagle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bbh Limited and First Eagle
The main advantage of trading using opposite Bbh Limited and First Eagle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bbh Limited position performs unexpectedly, First Eagle 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 First Eagle will offset losses from the drop in First Eagle's long position.| Bbh Limited vs. T Rowe Price | Bbh Limited vs. Bbh Limited Duration | Bbh Limited vs. Calamos Global Vertible | Bbh Limited vs. Prudential Floating Rate |
| First Eagle vs. Oklahoma College Savings | First Eagle vs. Small Pany Growth | First Eagle vs. Ab Small Cap | First Eagle vs. Champlain Small |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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