Correlation Between PennantPark Investment and UNIPHAR PLC
Can any of the company-specific risk be diversified away by investing in both PennantPark Investment and UNIPHAR 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 PennantPark Investment and UNIPHAR PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PennantPark Investment and UNIPHAR PLC EO, you can compare the effects of market volatilities on PennantPark Investment and UNIPHAR 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 PennantPark Investment with a short position of UNIPHAR PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of PennantPark Investment and UNIPHAR PLC.
Diversification Opportunities for PennantPark Investment and UNIPHAR PLC
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between PennantPark and UNIPHAR is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding PennantPark Investment and UNIPHAR PLC EO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UNIPHAR PLC EO and PennantPark Investment 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 PennantPark Investment are associated (or correlated) with UNIPHAR PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UNIPHAR PLC EO has no effect on the direction of PennantPark Investment i.e., PennantPark Investment and UNIPHAR PLC go up and down completely randomly.
Pair Corralation between PennantPark Investment and UNIPHAR PLC
Assuming the 90 days horizon PennantPark Investment is expected to generate 0.66 times more return on investment than UNIPHAR PLC. However, PennantPark Investment is 1.51 times less risky than UNIPHAR PLC. It trades about 0.06 of its potential returns per unit of risk. UNIPHAR PLC EO is currently generating about -0.01 per unit of risk. If you would invest 409.00 in PennantPark Investment on August 30, 2024 and sell it today you would earn a total of 249.00 from holding PennantPark Investment or generate 60.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PennantPark Investment vs. UNIPHAR PLC EO
Performance |
| Timeline |
| PennantPark Investment |
| UNIPHAR PLC EO |
PennantPark Investment and UNIPHAR PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PennantPark Investment and UNIPHAR PLC
The main advantage of trading using opposite PennantPark Investment and UNIPHAR PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PennantPark Investment position performs unexpectedly, UNIPHAR 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 UNIPHAR PLC will offset losses from the drop in UNIPHAR PLC's long position.| PennantPark Investment vs. THAI BEVERAGE | PennantPark Investment vs. LG Display Co | PennantPark Investment vs. USWE SPORTS AB | PennantPark Investment vs. NISSIN FOODS HLDGS |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |