Correlation Between Nasdaq 100 and First Eagle

Can any of the company-specific risk be diversified away by investing in both Nasdaq 100 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 Nasdaq 100 and First Eagle into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Nasdaq 100 Fund Class and First Eagle Fund, you can compare the effects of market volatilities on Nasdaq 100 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 Nasdaq 100 with a short position of First Eagle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nasdaq 100 and First Eagle.

Diversification Opportunities for Nasdaq 100 and First Eagle

0.97

Correlation Coefficient

Nasdaq 100  First Eagle

Almost no diversification

The 3 months correlation between Nasdaq and First is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Nasdaq 100 Fund Class and First Eagle Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Eagle Fund and Nasdaq 100 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 Nasdaq 100 Fund Class 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 Fund has no effect on the direction of Nasdaq 100 i.e., Nasdaq 100 and First Eagle go up and down completely randomly.

Pair Corralation between Nasdaq 100 and First Eagle

Assuming the 90 days horizon Nasdaq 100 Fund Class is expected to generate 1.23 times more return on investment than First Eagle. However, Nasdaq 100 is 1.23 times more volatile than First Eagle Fund. It trades about 0.21 of its potential returns per unit of risk. First Eagle Fund is currently generating about 0.23 per unit of risk. If you would invest  7,366  in Nasdaq 100 Fund Class on May 19, 2025 and sell it today you would earn a total of  803.00  from holding Nasdaq 100 Fund Class or generate 10.9% return on investment over 90 days.

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

Nasdaq 100 Fund Class  vs.  First Eagle Fund

Nasdaq 100 Fund

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Nasdaq 100 Fund Class are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Nasdaq 100 may actually be approaching a critical reversion point that can send shares even higher in September 2025.

First Eagle Fund

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in First Eagle Fund are ranked lower than 18 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, First Eagle may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Nasdaq 100 and First Eagle

The main advantage of trading using opposite Nasdaq 100 and First Eagle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nasdaq 100 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 Nasdaq 100 Fund Class and First Eagle Fund 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.