Correlation Between First Eagle and Great West
Can any of the company-specific risk be diversified away by investing in both First Eagle and Great West 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 Great West into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Eagle Gold and Great West Goldman Sachs, you can compare the effects of market volatilities on First Eagle and Great West 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 Great West. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Eagle and Great West.
Diversification Opportunities for First Eagle and Great West
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between First and Great is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding First Eagle Gold and Great West Goldman Sachs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Great West Goldman 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 Gold are associated (or correlated) with Great West. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Great West Goldman has no effect on the direction of First Eagle i.e., First Eagle and Great West go up and down completely randomly.
Pair Corralation between First Eagle and Great West
Assuming the 90 days horizon First Eagle is expected to generate 13.94 times less return on investment than Great West. In addition to that, First Eagle is 2.05 times more volatile than Great West Goldman Sachs. It trades about 0.01 of its total potential returns per unit of risk. Great West Goldman Sachs is currently generating about 0.26 per unit of volatility. If you would invest 837.00 in Great West Goldman Sachs on April 23, 2025 and sell it today you would earn a total of 35.00 from holding Great West Goldman Sachs or generate 4.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
First Eagle Gold vs. Great West Goldman Sachs
Performance |
| Timeline |
| First Eagle Gold |
| Great West Goldman |
First Eagle and Great West Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Eagle and Great West
The main advantage of trading using opposite First Eagle and Great West positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Eagle position performs unexpectedly, Great West 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 Great West will offset losses from the drop in Great West's long position.| First Eagle vs. First Eagle Gold | First Eagle vs. First Eagle Gold | First Eagle vs. Franklin Gold Precious | First Eagle vs. First Eagle Global |
| Great West vs. Global Resources Fund | Great West vs. Gmo Resources | Great West vs. Calvert Global Energy | Great West vs. World Energy Fund |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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