Correlation Between Nokia Corp and First Eagle

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

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

Diversification Opportunities for Nokia Corp and First Eagle

-0.37

Correlation Coefficient

Nokia Corp  First Eagle

Very good diversification

The 3 months correlation between Nokia and First is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Nokia Corp ADR 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 Nokia Corp 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 Nokia Corp ADR 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 Nokia Corp i.e., Nokia Corp and First Eagle go up and down completely randomly.

Pair Corralation between Nokia Corp and First Eagle

Considering the 90-day investment horizon Nokia Corp ADR is expected to under-perform the First Eagle. In addition to that, Nokia Corp is 2.65 times more volatile than First Eagle Overseas. It trades about -0.21 of its total potential returns per unit of risk. First Eagle Overseas is currently generating about 0.1 per unit of volatility. If you would invest  2,830  in First Eagle Overseas on May 4, 2025 and sell it today you would earn a total of  97.00  from holding First Eagle Overseas or generate 3.43% return on investment over 90 days.

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

Nokia Corp ADR  vs.  First Eagle Overseas

Nokia Corp ADR

Risk-Adjusted Performance

Very Weak

Over the last 90 days Nokia Corp ADR has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in September 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

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 Nokia Corp and First Eagle

The main advantage of trading using opposite Nokia Corp and First Eagle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nokia Corp 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 Nokia Corp ADR 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.

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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.