Correlation Between Academy Sports and First Eagle

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

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

Diversification Opportunities for Academy Sports and First Eagle

0.79

Correlation Coefficient

Academy Sports  First Eagle

Poor diversification

The 3 months correlation between Academy and First is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Academy Sports Outdoors and First Eagle Overseas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Eagle Overseas and Academy Sports 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 Academy Sports Outdoors 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 Overseas has no effect on the direction of Academy Sports i.e., Academy Sports and First Eagle go up and down completely randomly.

Pair Corralation between Academy Sports and First Eagle

Considering the 90-day investment horizon Academy Sports Outdoors is expected to generate 6.07 times more return on investment than First Eagle. However, Academy Sports is 6.07 times more volatile than First Eagle Overseas. It trades about 0.14 of its potential returns per unit of risk. First Eagle Overseas is currently generating about 0.1 per unit of risk. If you would invest  3,769  in Academy Sports Outdoors on May 4, 2025 and sell it today you would earn a total of  1,158  from holding Academy Sports Outdoors or generate 30.72% return on investment over 90 days.

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

Academy Sports Outdoors  vs.  First Eagle Overseas

Academy Sports Outdoors

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Academy Sports Outdoors are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Academy Sports displayed solid returns over the last few months and may actually be approaching a breakup point.

First Eagle Overseas

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in First Eagle Overseas are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. 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.

Pair Trading with Academy Sports and First Eagle

The main advantage of trading using opposite Academy Sports and First Eagle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Academy Sports 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 Academy Sports Outdoors and First Eagle Overseas 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.