Correlation Between First Eagle and Calamos Growth

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

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

Diversification Opportunities for First Eagle and Calamos Growth

-0.17

Correlation Coefficient

First Eagle  Calamos Growth

Good diversification

The 3 months correlation between First and Calamos is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding First Eagle Global and Calamos Growth Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos Growth Income 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 Global are associated (or correlated) with Calamos Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos Growth Income has no effect on the direction of First Eagle i.e., First Eagle and Calamos Growth go up and down completely randomly.

Pair Corralation between First Eagle and Calamos Growth

Assuming the 90 days horizon First Eagle Global is expected to under-perform the Calamos Growth. In addition to that, First Eagle is 1.38 times more volatile than Calamos Growth Income. It trades about -0.07 of its total potential returns per unit of risk. Calamos Growth Income is currently generating about 0.22 per unit of volatility. If you would invest  4,539  in Calamos Growth Income on September 12, 2024 and sell it today you would earn a total of  381.00  from holding Calamos Growth Income or generate 8.39% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

First Eagle Global  vs.  Calamos Growth Income

First Eagle Global

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days First Eagle Global has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward indicators, First Eagle is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Calamos Growth Income

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Calamos Growth Income are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Calamos Growth may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with First Eagle and Calamos Growth

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

The idea behind First Eagle Global and Calamos 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.

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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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.