Correlation Between Federated Hermes and Eagle Growth

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

By analyzing existing cross correlation between Federated Hermes Conservative and Eagle Growth Income, you can compare the effects of market volatilities on Federated Hermes and Eagle Growth 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 Federated Hermes with a short position of Eagle Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Hermes and Eagle Growth.

Diversification Opportunities for Federated Hermes and Eagle Growth

-0.07

Correlation Coefficient

Federated Hermes  Eagle Growth

Good diversification

The 3 months correlation between Federated and Eagle is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Federated Hermes Conservative and Eagle Growth Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eagle Growth Income and Federated Hermes 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 Federated Hermes Conservative are associated (or correlated) with Eagle Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eagle Growth Income has no effect on the direction of Federated Hermes i.e., Federated Hermes and Eagle Growth go up and down completely randomly.

Pair Corralation between Federated Hermes and Eagle Growth

If you would invest  1,001  in Federated Hermes Conservative on October 9, 2024 and sell it today you would earn a total of  0.00  from holding Federated Hermes Conservative or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.0%
Values	Daily Returns

Federated Hermes Conservative  vs.  Eagle Growth Income

Federated Hermes Con

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Federated Hermes Conservative are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Federated Hermes is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Eagle Growth Income

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Eagle Growth Income has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's fundamental indicators remain fairly strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Pair Trading with Federated Hermes and Eagle Growth

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

The idea behind Federated Hermes Conservative and Eagle Growth Income 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.