Correlation Between First Eagle and Columbia Small
Can any of the company-specific risk be diversified away by investing in both First Eagle and Columbia Small 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 Columbia Small 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 Columbia Small Cap, you can compare the effects of market volatilities on First Eagle and Columbia Small 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 Columbia Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Eagle and Columbia Small.
Diversification Opportunities for First Eagle and Columbia Small
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between First and Columbia is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding First Eagle Gold and Columbia Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbia Small Cap 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 Columbia Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbia Small Cap has no effect on the direction of First Eagle i.e., First Eagle and Columbia Small go up and down completely randomly.
Pair Corralation between First Eagle and Columbia Small
Assuming the 90 days horizon First Eagle Gold is expected to under-perform the Columbia Small. In addition to that, First Eagle is 1.3 times more volatile than Columbia Small Cap. It trades about -0.07 of its total potential returns per unit of risk. Columbia Small Cap is currently generating about 0.07 per unit of volatility. If you would invest 5,288 in Columbia Small Cap on October 25, 2024 and sell it today you would earn a total of 257.00 from holding Columbia Small Cap or generate 4.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Eagle Gold vs. Columbia Small Cap
Performance |
| Timeline |
| First Eagle Gold |
| Columbia Small Cap |
First Eagle and Columbia Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Eagle and Columbia Small
The main advantage of trading using opposite First Eagle and Columbia Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Eagle position performs unexpectedly, Columbia Small 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 Columbia Small will offset losses from the drop in Columbia Small's long position.| First Eagle vs. First Eagle Gold | First Eagle vs. First Eagle Gold | First Eagle vs. Franklin Gold Precious | First Eagle vs. First Eagle Global |
| Columbia Small vs. Sprott Gold Equity | Columbia Small vs. James Balanced Golden | Columbia Small vs. First Eagle Gold | Columbia Small 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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