Correlation Between First Eagle and Akre Focus
Can any of the company-specific risk be diversified away by investing in both First Eagle and Akre Focus 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 Akre Focus 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 Akre Focus Fund, you can compare the effects of market volatilities on First Eagle and Akre Focus 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 Akre Focus. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Eagle and Akre Focus.
Diversification Opportunities for First Eagle and Akre Focus
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between First and Akre is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding First Eagle Global and Akre Focus Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akre Focus Fund 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 Akre Focus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akre Focus Fund has no effect on the direction of First Eagle i.e., First Eagle and Akre Focus go up and down completely randomly.
Pair Corralation between First Eagle and Akre Focus
Assuming the 90 days horizon First Eagle is expected to generate 1.54 times less return on investment than Akre Focus. But when comparing it to its historical volatility, First Eagle Global is 1.35 times less risky than Akre Focus. It trades about 0.09 of its potential returns per unit of risk. Akre Focus Fund is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 4,996 in Akre Focus Fund on September 3, 2024 and sell it today you would earn a total of 2,519 from holding Akre Focus Fund or generate 50.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Eagle Global vs. Akre Focus Fund
Performance |
| Timeline |
| First Eagle Global |
| Akre Focus Fund |
First Eagle and Akre Focus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Eagle and Akre Focus
The main advantage of trading using opposite First Eagle and Akre Focus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Eagle position performs unexpectedly, Akre Focus 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 Akre Focus will offset losses from the drop in Akre Focus' long position.| First Eagle vs. Blackrock Gbl Alloc | First Eagle vs. Ivy Asset Strategy | First Eagle vs. Fpa Crescent Fund | First Eagle vs. Templeton Global Bond |
| Akre Focus vs. Akre Focus Fund | Akre Focus vs. Akre Focus Fund | Akre Focus vs. T Rowe Price | Akre Focus vs. Aqr Diversified Arbitrage |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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