Correlation Between Touchstone Premium and First Eagle
Can any of the company-specific risk be diversified away by investing in both Touchstone Premium 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 Touchstone Premium and First Eagle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Touchstone Premium Yield and First Eagle Small, you can compare the effects of market volatilities on Touchstone Premium 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 Touchstone Premium with a short position of First Eagle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Touchstone Premium and First Eagle.
Diversification Opportunities for Touchstone Premium and First Eagle
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Touchstone and First is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Touchstone Premium Yield and First Eagle Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Eagle Small and Touchstone Premium 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 Touchstone Premium Yield 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 Small has no effect on the direction of Touchstone Premium i.e., Touchstone Premium and First Eagle go up and down completely randomly.
Pair Corralation between Touchstone Premium and First Eagle
Assuming the 90 days horizon Touchstone Premium Yield is expected to generate 0.84 times more return on investment than First Eagle. However, Touchstone Premium Yield is 1.19 times less risky than First Eagle. It trades about 0.27 of its potential returns per unit of risk. First Eagle Small is currently generating about -0.02 per unit of risk. If you would invest 879.00 in Touchstone Premium Yield on September 12, 2024 and sell it today you would earn a total of 35.00 from holding Touchstone Premium Yield or generate 3.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Touchstone Premium Yield vs. First Eagle Small
Performance |
| Timeline |
| Touchstone Premium Yield |
| First Eagle Small |
Touchstone Premium and First Eagle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Touchstone Premium and First Eagle
The main advantage of trading using opposite Touchstone Premium and First Eagle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Touchstone Premium 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.| Touchstone Premium vs. Europacific Growth Fund | Touchstone Premium vs. SCOR PK | Touchstone Premium vs. Morningstar Unconstrained Allocation | Touchstone Premium vs. Thrivent High Yield |
| First Eagle vs. T Rowe Price | First Eagle vs. Qs Large Cap | First Eagle vs. T Rowe Price | First Eagle vs. Jhancock Disciplined Value |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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