Correlation Between Smallcap Growth and First Eagle
Can any of the company-specific risk be diversified away by investing in both Smallcap Growth and First Eagle 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 Smallcap Growth and First Eagle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Smallcap Growth Fund and First Eagle Gold, you can compare the effects of market volatilities on Smallcap Growth and First Eagle 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 Smallcap Growth with a short position of First Eagle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Smallcap Growth and First Eagle.
Diversification Opportunities for Smallcap Growth and First Eagle
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Smallcap and First is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Smallcap Growth Fund and First Eagle Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Eagle Gold and Smallcap Growth 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 Smallcap Growth Fund are associated (or correlated) with First Eagle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Eagle Gold has no effect on the direction of Smallcap Growth i.e., Smallcap Growth and First Eagle go up and down completely randomly.
Pair Corralation between Smallcap Growth and First Eagle
If you would invest 1,521 in Smallcap Growth Fund on September 4, 2024 and sell it today you would earn a total of 207.00 from holding Smallcap Growth Fund or generate 13.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 1.56% |
| Values | Daily Returns |
Smallcap Growth Fund vs. First Eagle Gold
Performance |
| Timeline |
| Smallcap Growth |
| First Eagle Gold |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Smallcap Growth and First Eagle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Smallcap Growth and First Eagle
The main advantage of trading using opposite Smallcap Growth and First Eagle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Smallcap Growth position performs unexpectedly, First Eagle 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 First Eagle will offset losses from the drop in First Eagle's long position.| Smallcap Growth vs. Strategic Asset Management | Smallcap Growth vs. Strategic Asset Management | Smallcap Growth vs. Strategic Asset Management | Smallcap Growth vs. Strategic Asset Management |
| First Eagle vs. T Rowe Price | First Eagle vs. Pace Smallmedium Growth | First Eagle vs. Chase Growth Fund | First Eagle vs. Smallcap Growth Fund |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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