Correlation Between First Eagle and Pimco Income
Can any of the company-specific risk be diversified away by investing in both First Eagle and Pimco Income 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 Pimco Income into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Eagle Global and Pimco Income Fund, you can compare the effects of market volatilities on First Eagle and Pimco Income 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 Pimco Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Eagle and Pimco Income.
Diversification Opportunities for First Eagle and Pimco Income
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between First and Pimco is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding First Eagle Global and Pimco Income Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco Income 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 Global are associated (or correlated) with Pimco Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco Income has no effect on the direction of First Eagle i.e., First Eagle and Pimco Income go up and down completely randomly.
Pair Corralation between First Eagle and Pimco Income
Assuming the 90 days horizon First Eagle Global is expected to generate 2.26 times more return on investment than Pimco Income. However, First Eagle is 2.26 times more volatile than Pimco Income Fund. It trades about 0.12 of its potential returns per unit of risk. Pimco Income Fund is currently generating about 0.07 per unit of risk. If you would invest 6,098 in First Eagle Global on August 29, 2024 and sell it today you would earn a total of 872.00 from holding First Eagle Global or generate 14.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.52% |
| Values | Daily Returns |
First Eagle Global vs. Pimco Income Fund
Performance |
| Timeline |
| First Eagle Global |
| Pimco Income |
First Eagle and Pimco Income Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Eagle and Pimco Income
The main advantage of trading using opposite First Eagle and Pimco Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Eagle position performs unexpectedly, Pimco Income 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 Pimco Income will offset losses from the drop in Pimco Income's long position.| First Eagle vs. Ivy Asset Strategy | First Eagle vs. Blackrock Gbl Alloc | First Eagle vs. Templeton Global Bond | First Eagle vs. Loomis Sayles Strategic |
| Pimco Income vs. Angel Oak Ultrashort | Pimco Income vs. Artisan Emerging Markets | Pimco Income vs. Ambrus Core Bond | Pimco Income vs. Federated Short Intermediate Duration |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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