Correlation Between First Eagle and Western Asset
Can any of the company-specific risk be diversified away by investing in both First Eagle and Western Asset 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 Western Asset 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 Western Asset Porate, you can compare the effects of market volatilities on First Eagle and Western Asset 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 Western Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Eagle and Western Asset.
Diversification Opportunities for First Eagle and Western Asset
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between First and Western is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding First Eagle Gold and Western Asset Porate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Asset Porate 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 Western Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Asset Porate has no effect on the direction of First Eagle i.e., First Eagle and Western Asset go up and down completely randomly.
Pair Corralation between First Eagle and Western Asset
Assuming the 90 days horizon First Eagle Gold is expected to generate 3.5 times more return on investment than Western Asset. However, First Eagle is 3.5 times more volatile than Western Asset Porate. It trades about 0.05 of its potential returns per unit of risk. Western Asset Porate is currently generating about 0.04 per unit of risk. If you would invest 1,943 in First Eagle Gold on November 9, 2024 and sell it today you would earn a total of 749.00 from holding First Eagle Gold or generate 38.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Eagle Gold vs. Western Asset Porate
Performance |
| Timeline |
| First Eagle Gold |
| Western Asset Porate |
First Eagle and Western Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Eagle and Western Asset
The main advantage of trading using opposite First Eagle and Western Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Eagle position performs unexpectedly, Western Asset 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 Western Asset will offset losses from the drop in Western Asset'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 |
| Western Asset vs. Great West Loomis Sayles | Western Asset vs. Palm Valley Capital | Western Asset vs. Vanguard Small Cap Value | Western Asset vs. Ab Small Cap |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |