Correlation Between First Eagle and Pro-blend(r) Moderate
Can any of the company-specific risk be diversified away by investing in both First Eagle and Pro-blend(r) Moderate 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 Pro-blend(r) Moderate 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 Pro Blend Moderate Term, you can compare the effects of market volatilities on First Eagle and Pro-blend(r) Moderate 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 Pro-blend(r) Moderate. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Eagle and Pro-blend(r) Moderate.
Diversification Opportunities for First Eagle and Pro-blend(r) Moderate
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between FIRST and Pro-blend(r) is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding First Eagle Global and Pro Blend Moderate Term in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pro-blend(r) Moderate 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 Pro-blend(r) Moderate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pro-blend(r) Moderate has no effect on the direction of First Eagle i.e., First Eagle and Pro-blend(r) Moderate go up and down completely randomly.
Pair Corralation between First Eagle and Pro-blend(r) Moderate
Assuming the 90 days horizon First Eagle Global is expected to under-perform the Pro-blend(r) Moderate. In addition to that, First Eagle is 1.34 times more volatile than Pro Blend Moderate Term. It trades about -0.09 of its total potential returns per unit of risk. Pro Blend Moderate Term is currently generating about -0.04 per unit of volatility. If you would invest 1,502 in Pro Blend Moderate Term on August 31, 2024 and sell it today you would lose (10.00) from holding Pro Blend Moderate Term or give up 0.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Eagle Global vs. Pro Blend Moderate Term
Performance |
| Timeline |
| First Eagle Global |
| Pro-blend(r) Moderate |
First Eagle and Pro-blend(r) Moderate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Eagle and Pro-blend(r) Moderate
The main advantage of trading using opposite First Eagle and Pro-blend(r) Moderate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Eagle position performs unexpectedly, Pro-blend(r) Moderate 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 Pro-blend(r) Moderate will offset losses from the drop in Pro-blend(r) Moderate's 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 |
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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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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