Correlation Between First Eagle and Thornburg Global
Can any of the company-specific risk be diversified away by investing in both First Eagle and Thornburg Global 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 Thornburg Global 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 Thornburg Global Opportunities, you can compare the effects of market volatilities on First Eagle and Thornburg Global 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 Thornburg Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Eagle and Thornburg Global.
Diversification Opportunities for First Eagle and Thornburg Global
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between First and Thornburg is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding First Eagle Global and Thornburg Global Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thornburg Global Opp 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 Thornburg Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thornburg Global Opp has no effect on the direction of First Eagle i.e., First Eagle and Thornburg Global go up and down completely randomly.
Pair Corralation between First Eagle and Thornburg Global
Assuming the 90 days horizon First Eagle Global is expected to generate 0.6 times more return on investment than Thornburg Global. However, First Eagle Global is 1.67 times less risky than Thornburg Global. It trades about 0.03 of its potential returns per unit of risk. Thornburg Global Opportunities is currently generating about -0.19 per unit of risk. If you would invest 7,388 in First Eagle Global on September 3, 2024 and sell it today you would earn a total of 22.00 from holding First Eagle Global or generate 0.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Eagle Global vs. Thornburg Global Opportunities
Performance |
| Timeline |
| First Eagle Global |
| Thornburg Global Opp |
First Eagle and Thornburg Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Eagle and Thornburg Global
The main advantage of trading using opposite First Eagle and Thornburg Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Eagle position performs unexpectedly, Thornburg Global 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 Thornburg Global will offset losses from the drop in Thornburg Global'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 |
| Thornburg Global vs. Fm Investments Large | Thornburg Global vs. Growth Strategy Fund | Thornburg Global vs. T Rowe Price | Thornburg Global vs. Qs Global Equity |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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