Correlation Between First Eagle and BBX Capital

Can any of the company-specific risk be diversified away by investing in both First Eagle and BBX Capital 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 BBX Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between First Eagle Alternative and BBX Capital, you can compare the effects of market volatilities on First Eagle and BBX Capital 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 BBX Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Eagle and BBX Capital.

Diversification Opportunities for First Eagle and BBX Capital

0.0

Correlation Coefficient

First Eagle  BBX Capital

Pay attention - limited upside

The 3 months correlation between First and BBX is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding First Eagle Alternative and BBX Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BBX Capital 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 Alternative are associated (or correlated) with BBX Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BBX Capital has no effect on the direction of First Eagle i.e., First Eagle and BBX Capital go up and down completely randomly.

Pair Corralation between First Eagle and BBX Capital

If you would invest (100.00) in First Eagle Alternative on December 17, 2024 and sell it today you would earn a total of  100.00  from holding First Eagle Alternative or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

First Eagle Alternative  vs.  BBX Capital

First Eagle Alternative

Risk-Adjusted Performance

Very Weak

Over the last 90 days First Eagle Alternative has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, First Eagle is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

BBX Capital

Risk-Adjusted Performance

Very Weak

Over the last 90 days BBX Capital has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's forward indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with First Eagle and BBX Capital

The main advantage of trading using opposite First Eagle and BBX Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Eagle position performs unexpectedly, BBX Capital 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 BBX Capital will offset losses from the drop in BBX Capital's long position.

The idea behind First Eagle Alternative and BBX Capital pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.