Correlation Between Us Small and First Eagle
Can any of the company-specific risk be diversified away by investing in both Us Small 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 Us Small and First Eagle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Us Small Cap and First Eagle Value, you can compare the effects of market volatilities on Us Small 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 Us Small with a short position of First Eagle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Us Small and First Eagle.
Diversification Opportunities for Us Small and First Eagle
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between RLESX and First is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Us Small Cap and First Eagle Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Eagle Value and Us Small 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 Us Small Cap 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 Value has no effect on the direction of Us Small i.e., Us Small and First Eagle go up and down completely randomly.
Pair Corralation between Us Small and First Eagle
Assuming the 90 days horizon Us Small Cap is expected to generate 3.65 times more return on investment than First Eagle. However, Us Small is 3.65 times more volatile than First Eagle Value. It trades about 0.3 of its potential returns per unit of risk. First Eagle Value is currently generating about 0.23 per unit of risk. If you would invest 2,840 in Us Small Cap on September 1, 2024 and sell it today you would earn a total of 291.00 from holding Us Small Cap or generate 10.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Us Small Cap vs. First Eagle Value
Performance |
| Timeline |
| Us Small Cap |
| First Eagle Value |
Us Small and First Eagle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Us Small and First Eagle
The main advantage of trading using opposite Us Small and First Eagle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Us Small 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.| Us Small vs. International Developed Markets | Us Small vs. Global Real Estate | Us Small vs. Global Real Estate | Us Small vs. Global Real Estate |
| First Eagle vs. Champlain Small | First Eagle vs. Us Small Cap | First Eagle vs. Chartwell Small Cap | First Eagle vs. Victory Rs Small |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |