Correlation Between Fabxx and First Eagle
Can any of the company-specific risk be diversified away by investing in both Fabxx 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 Fabxx and First Eagle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fabxx and First Eagle Fund, you can compare the effects of market volatilities on Fabxx 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 Fabxx with a short position of First Eagle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fabxx and First Eagle.
Diversification Opportunities for Fabxx and First Eagle
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Fabxx and First is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Fabxx and First Eagle Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Eagle Fund and Fabxx 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 Fabxx 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 Fund has no effect on the direction of Fabxx i.e., Fabxx and First Eagle go up and down completely randomly.
Pair Corralation between Fabxx and First Eagle
Assuming the 90 days horizon Fabxx is expected to under-perform the First Eagle. In addition to that, Fabxx is 18.66 times more volatile than First Eagle Fund. It trades about -0.03 of its total potential returns per unit of risk. First Eagle Fund is currently generating about 0.18 per unit of volatility. If you would invest 2,699 in First Eagle Fund on December 2, 2024 and sell it today you would earn a total of 132.00 from holding First Eagle Fund or generate 4.89% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Fabxx vs. First Eagle Fund
Performance |
Timeline |
Fabxx |
First Eagle Fund |
Fabxx and First Eagle Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Fabxx and First Eagle
The main advantage of trading using opposite Fabxx and First Eagle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fabxx 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.Fabxx vs. T Rowe Price | Fabxx vs. Touchstone Large Cap | Fabxx vs. Enhanced Large Pany | Fabxx vs. Hartford Moderate Allocation |
First Eagle vs. Catholic Responsible Investments | First Eagle vs. Rbc Short Duration | First Eagle vs. Transamerica Short Term Bond | First Eagle vs. Blackrock Global Longshort |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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