Correlation Between First Eagle and Baron Durable
Can any of the company-specific risk be diversified away by investing in both First Eagle and Baron Durable 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 Baron Durable into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Eagle Gold and Baron Durable Advantage, you can compare the effects of market volatilities on First Eagle and Baron Durable 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 Baron Durable. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Eagle and Baron Durable.
Diversification Opportunities for First Eagle and Baron Durable
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between FIRST and Baron is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding First Eagle Gold and Baron Durable Advantage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baron Durable Advantage 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 Gold are associated (or correlated) with Baron Durable. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baron Durable Advantage has no effect on the direction of First Eagle i.e., First Eagle and Baron Durable go up and down completely randomly.
Pair Corralation between First Eagle and Baron Durable
Assuming the 90 days horizon First Eagle is expected to generate 1.22 times less return on investment than Baron Durable. In addition to that, First Eagle is 1.69 times more volatile than Baron Durable Advantage. It trades about 0.06 of its total potential returns per unit of risk. Baron Durable Advantage is currently generating about 0.13 per unit of volatility. If you would invest 2,179 in Baron Durable Advantage on September 4, 2024 and sell it today you would earn a total of 737.00 from holding Baron Durable Advantage or generate 33.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Eagle Gold vs. Baron Durable Advantage
Performance |
| Timeline |
| First Eagle Gold |
| Baron Durable Advantage |
First Eagle and Baron Durable Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Eagle and Baron Durable
The main advantage of trading using opposite First Eagle and Baron Durable positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Eagle position performs unexpectedly, Baron Durable 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 Baron Durable will offset losses from the drop in Baron Durable's long position.| First Eagle vs. First Eagle Gold | First Eagle vs. First Eagle Global | First Eagle vs. Oppenheimer Gold Special | First Eagle vs. Aquagold International |
| Baron Durable vs. First Eagle Gold | Baron Durable vs. Fidelity Advisor Gold | Baron Durable vs. James Balanced Golden | Baron Durable vs. Vy Goldman Sachs |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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