Correlation Between First Guaranty and Linde Plc

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

By analyzing existing cross correlation between First Guaranty Bancshares and Linde plc Ordinary, you can compare the effects of market volatilities on First Guaranty and Linde Plc 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 Guaranty with a short position of Linde Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Guaranty and Linde Plc.

Diversification Opportunities for First Guaranty and Linde Plc

-0.48

Correlation Coefficient

First Guaranty  Linde Plc

Very good diversification

The 3 months correlation between First and Linde is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding First Guaranty Bancshares and Linde plc Ordinary in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Linde plc Ordinary and First Guaranty 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 Guaranty Bancshares are associated (or correlated) with Linde Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Linde plc Ordinary has no effect on the direction of First Guaranty i.e., First Guaranty and Linde Plc go up and down completely randomly.

Pair Corralation between First Guaranty and Linde Plc

Given the investment horizon of 90 days First Guaranty Bancshares is expected to under-perform the Linde Plc. In addition to that, First Guaranty is 2.35 times more volatile than Linde plc Ordinary. It trades about -0.07 of its total potential returns per unit of risk. Linde plc Ordinary is currently generating about -0.04 per unit of volatility. If you would invest  47,407  in Linde plc Ordinary on July 3, 2025 and sell it today you would lose (1,002) from holding Linde plc Ordinary or give up 2.11% of portfolio value over 90 days.

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

First Guaranty Bancshares  vs.  Linde plc Ordinary

First Guaranty Bancshares

Risk-Adjusted Performance

Weakest

Over the last 90 days First Guaranty Bancshares has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's fundamental drivers remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Linde plc Ordinary

Risk-Adjusted Performance

Weakest

Over the last 90 days Linde plc Ordinary has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy forward indicators, Linde Plc is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with First Guaranty and Linde Plc

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

The idea behind First Guaranty Bancshares and Linde plc Ordinary 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 CEOs Directory module to screen CEOs from public companies around the world.