Correlation Between Guidepath Managed and First Eagle

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

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

Diversification Opportunities for Guidepath Managed and First Eagle

0.34

Correlation Coefficient

Guidepath Managed  First Eagle

Weak diversification

The 3 months correlation between Guidepath and First is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Guidepath Managed Futures and First Eagle High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Eagle High and Guidepath Managed 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 Guidepath Managed Futures are associated (or correlated) with First Eagle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Eagle High has no effect on the direction of Guidepath Managed i.e., Guidepath Managed and First Eagle go up and down completely randomly.

Pair Corralation between Guidepath Managed and First Eagle

Assuming the 90 days horizon Guidepath Managed Futures is expected to under-perform the First Eagle. In addition to that, Guidepath Managed is 1.54 times more volatile than First Eagle High. It trades about -0.06 of its total potential returns per unit of risk. First Eagle High is currently generating about 0.0 per unit of volatility. If you would invest  869.00  in First Eagle High on September 15, 2024 and sell it today you would earn a total of  0.00  from holding First Eagle High or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Guidepath Managed Futures  vs.  First Eagle High

Guidepath Managed Futures

Risk-Adjusted Performance

0 of 100

Very Weak

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

First Eagle High

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Guidepath Managed and First Eagle

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

The idea behind Guidepath Managed Futures and First Eagle High 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.