Correlation Between PennantPark Investment and New York
Can any of the company-specific risk be diversified away by investing in both PennantPark Investment and New York 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 New York into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PennantPark Investment and New York Community, you can compare the effects of market volatilities on PennantPark Investment and New York 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 New York. Check out your portfolio center. Please also check ongoing floating volatility patterns of PennantPark Investment and New York.
Diversification Opportunities for PennantPark Investment and New York
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between PennantPark and New is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding PennantPark Investment and New York Community in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New York Community 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 New York. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New York Community has no effect on the direction of PennantPark Investment i.e., PennantPark Investment and New York go up and down completely randomly.
Pair Corralation between PennantPark Investment and New York
Assuming the 90 days horizon PennantPark Investment is expected to generate 0.87 times more return on investment than New York. However, PennantPark Investment is 1.15 times less risky than New York. It trades about 0.12 of its potential returns per unit of risk. New York Community is currently generating about 0.06 per unit of risk. If you would invest 653.00 in PennantPark Investment on October 24, 2024 and sell it today you would earn a total of 27.00 from holding PennantPark Investment or generate 4.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PennantPark Investment vs. New York Community
Performance |
| Timeline |
| PennantPark Investment |
| New York Community |
PennantPark Investment and New York Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PennantPark Investment and New York
The main advantage of trading using opposite PennantPark Investment and New York positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PennantPark Investment position performs unexpectedly, New York 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 New York will offset losses from the drop in New York's long position.| PennantPark Investment vs. CITY OFFICE REIT | PennantPark Investment vs. CAL MAINE FOODS | PennantPark Investment vs. THAI BEVERAGE | PennantPark Investment vs. Molson Coors Beverage |
| New York vs. Mitsui Chemicals | New York vs. BII Railway Transportation | New York vs. MTY Food Group | New York vs. GOLD ROAD RES |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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