Correlation Between First Eagle and Mfs Diversified

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

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

Diversification Opportunities for First Eagle and Mfs Diversified

0.93

Correlation Coefficient

First Eagle  Mfs Diversified

Almost no diversification

The 3 months correlation between First and Mfs is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding First Eagle Value and Mfs Diversified Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Diversified Income 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 Value are associated (or correlated) with Mfs Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Diversified Income has no effect on the direction of First Eagle i.e., First Eagle and Mfs Diversified go up and down completely randomly.

Pair Corralation between First Eagle and Mfs Diversified

Assuming the 90 days horizon First Eagle Value is expected to generate 1.87 times more return on investment than Mfs Diversified. However, First Eagle is 1.87 times more volatile than Mfs Diversified Income. It trades about 0.17 of its potential returns per unit of risk. Mfs Diversified Income is currently generating about 0.11 per unit of risk. If you would invest  2,356  in First Eagle Value on August 12, 2025 and sell it today you would earn a total of  137.00  from holding First Eagle Value or generate 5.81% return on investment over 90 days.

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

First Eagle Value  vs.  Mfs Diversified Income

First Eagle Value

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in First Eagle Value are ranked lower than 13 (%) 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.

Mfs Diversified Income

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Mfs Diversified Income are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Mfs Diversified 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 Mfs Diversified

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

The idea behind First Eagle Value and Mfs Diversified Income 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 Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.