Correlation Between First Eagle and Janus Enterprise

Can any of the company-specific risk be diversified away by investing in both First Eagle and Janus Enterprise 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 Janus Enterprise 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 Janus Enterprise Fund, you can compare the effects of market volatilities on First Eagle and Janus Enterprise 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 Janus Enterprise. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Eagle and Janus Enterprise.

Diversification Opportunities for First Eagle and Janus Enterprise

-0.09

Correlation Coefficient

First Eagle  Janus Enterprise

Good diversification

The 3 months correlation between First and Janus is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding First Eagle Global and Janus Enterprise Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Janus Enterprise 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 Janus Enterprise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Janus Enterprise has no effect on the direction of First Eagle i.e., First Eagle and Janus Enterprise go up and down completely randomly.

Pair Corralation between First Eagle and Janus Enterprise

Assuming the 90 days horizon First Eagle Global is expected to generate 0.6 times more return on investment than Janus Enterprise. However, First Eagle Global is 1.66 times less risky than Janus Enterprise. It trades about 0.22 of its potential returns per unit of risk. Janus Enterprise Fund is currently generating about -0.05 per unit of risk. If you would invest  6,732  in First Eagle Global on December 28, 2024 and sell it today you would earn a total of  538.00  from holding First Eagle Global or generate 7.99% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

First Eagle Global  vs.  Janus Enterprise Fund

First Eagle Global

Risk-Adjusted Performance

Good

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

Janus Enterprise

Risk-Adjusted Performance

Very Weak

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

Pair Trading with First Eagle and Janus Enterprise

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

The idea behind First Eagle Global and Janus Enterprise Fund 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.