Correlation Between First Eagle and Ab Select

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

By analyzing existing cross correlation between First Eagle Small and Ab Select Longshort, you can compare the effects of market volatilities on First Eagle and Ab Select 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 Ab Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Eagle and Ab Select.

Diversification Opportunities for First Eagle and Ab Select

0.64

Correlation Coefficient

First Eagle  Ab Select

Poor diversification

The 3 months correlation between First and ASCLX is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding First Eagle Small and Ab Select Longshort in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab Select Longshort 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 Small are associated (or correlated) with Ab Select. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab Select Longshort has no effect on the direction of First Eagle i.e., First Eagle and Ab Select go up and down completely randomly.

Pair Corralation between First Eagle and Ab Select

Assuming the 90 days horizon First Eagle Small is expected to generate 3.49 times more return on investment than Ab Select. However, First Eagle is 3.49 times more volatile than Ab Select Longshort. It trades about 0.14 of its potential returns per unit of risk. Ab Select Longshort is currently generating about 0.22 per unit of risk. If you would invest  979.00  in First Eagle Small on May 17, 2025 and sell it today you would earn a total of  103.00  from holding First Eagle Small or generate 10.52% return on investment over 90 days.

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

First Eagle Small  vs.  Ab Select Longshort

First Eagle Small

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in First Eagle Small are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, First Eagle may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Ab Select Longshort

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Ab Select Longshort are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong essential indicators, Ab Select is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with First Eagle and Ab Select

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

The idea behind First Eagle Small and Ab Select Longshort 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.