Correlation Between First Eagle and Investec Global
Can any of the company-specific risk be diversified away by investing in both First Eagle and Investec Global 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 Investec Global 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 Investec Global Franchise, you can compare the effects of market volatilities on First Eagle and Investec Global 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 Investec Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Eagle and Investec Global.
Diversification Opportunities for First Eagle and Investec Global
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between First and Investec is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding First Eagle Gold and Investec Global Franchise in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investec Global Franchise 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 Investec Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investec Global Franchise has no effect on the direction of First Eagle i.e., First Eagle and Investec Global go up and down completely randomly.
Pair Corralation between First Eagle and Investec Global
Assuming the 90 days horizon First Eagle Gold is expected to generate 2.04 times more return on investment than Investec Global. However, First Eagle is 2.04 times more volatile than Investec Global Franchise. It trades about 0.33 of its potential returns per unit of risk. Investec Global Franchise is currently generating about 0.06 per unit of risk. If you would invest 2,306 in First Eagle Gold on October 24, 2024 and sell it today you would earn a total of 188.00 from holding First Eagle Gold or generate 8.15% 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. Investec Global Franchise
Performance |
| Timeline |
| First Eagle Gold |
| Investec Global Franchise |
First Eagle and Investec Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Eagle and Investec Global
The main advantage of trading using opposite First Eagle and Investec Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Eagle position performs unexpectedly, Investec Global 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 Investec Global will offset losses from the drop in Investec Global'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 |
| Investec Global vs. Global Gold Fund | Investec Global vs. First Eagle Gold | Investec Global vs. International Investors Gold | Investec Global vs. Goldman Sachs Clean |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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