Correlation Between Saat Market and First Eagle
Can any of the company-specific risk be diversified away by investing in both Saat Market 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 Saat Market and First Eagle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saat Market Growth and First Eagle Global, you can compare the effects of market volatilities on Saat Market 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 Saat Market with a short position of First Eagle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saat Market and First Eagle.
Diversification Opportunities for Saat Market and First Eagle
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Saat and First is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Saat Market Growth and First Eagle Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Eagle Global and Saat Market 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 Saat Market Growth 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 Global has no effect on the direction of Saat Market i.e., Saat Market and First Eagle go up and down completely randomly.
Pair Corralation between Saat Market and First Eagle
Assuming the 90 days horizon Saat Market is expected to generate 1.09 times less return on investment than First Eagle. In addition to that, Saat Market is 1.11 times more volatile than First Eagle Global. It trades about 0.29 of its total potential returns per unit of risk. First Eagle Global is currently generating about 0.35 per unit of volatility. If you would invest 1,299 in First Eagle Global on November 1, 2024 and sell it today you would earn a total of 39.00 from holding First Eagle Global or generate 3.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Saat Market Growth vs. First Eagle Global
Performance |
| Timeline |
| Saat Market Growth |
| First Eagle Global |
Saat Market and First Eagle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saat Market and First Eagle
The main advantage of trading using opposite Saat Market and First Eagle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saat Market 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.| Saat Market vs. Tiaa Cref Inflation Link | Saat Market vs. Simt Multi Asset Inflation | Saat Market vs. Credit Suisse Multialternative | Saat Market vs. Guggenheim Managed Futures |
| First Eagle vs. Aqr Sustainable Long Short | First Eagle vs. Saat Market Growth | First Eagle vs. Fidelity New Markets | First Eagle vs. Doubleline Emerging Markets |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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