Correlation Between First Eagle and Boston Partners
Can any of the company-specific risk be diversified away by investing in both First Eagle and Boston Partners 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 First Eagle and Boston Partners into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Eagle Fund and Boston Partners Small, you can compare the effects of market volatilities on First Eagle and Boston Partners 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 First Eagle with a short position of Boston Partners. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Eagle and Boston Partners.
Diversification Opportunities for First Eagle and Boston Partners
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between First and Boston is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding First Eagle Fund and Boston Partners Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boston Partners Small and First Eagle 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 First Eagle Fund are associated (or correlated) with Boston Partners. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boston Partners Small has no effect on the direction of First Eagle i.e., First Eagle and Boston Partners go up and down completely randomly.
Pair Corralation between First Eagle and Boston Partners
Assuming the 90 days horizon First Eagle Fund is expected to generate 0.65 times more return on investment than Boston Partners. However, First Eagle Fund is 1.55 times less risky than Boston Partners. It trades about 0.08 of its potential returns per unit of risk. Boston Partners Small is currently generating about 0.04 per unit of risk. If you would invest 2,094 in First Eagle Fund on September 3, 2024 and sell it today you would earn a total of 712.00 from holding First Eagle Fund or generate 34.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Eagle Fund vs. Boston Partners Small
Performance |
| Timeline |
| First Eagle Fund |
| Boston Partners Small |
First Eagle and Boston Partners Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Eagle and Boston Partners
The main advantage of trading using opposite First Eagle and Boston Partners positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Eagle position performs unexpectedly, Boston Partners 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 Boston Partners will offset losses from the drop in Boston Partners' long position.| First Eagle vs. Vanguard Total Stock | First Eagle vs. Vanguard 500 Index | First Eagle vs. Vanguard Total Stock | First Eagle vs. Vanguard Total Stock |
| Boston Partners vs. Vanguard Small Cap Value | Boston Partners vs. Vanguard Small Cap Value | Boston Partners vs. Us Small Cap | Boston Partners vs. Us Targeted Value |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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