Correlation Between PennantPark Investment and Woodside Energy
Can any of the company-specific risk be diversified away by investing in both PennantPark Investment and Woodside Energy 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 Woodside Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PennantPark Investment and Woodside Energy Group, you can compare the effects of market volatilities on PennantPark Investment and Woodside Energy 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 Woodside Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of PennantPark Investment and Woodside Energy.
Diversification Opportunities for PennantPark Investment and Woodside Energy
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between PennantPark and Woodside is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding PennantPark Investment and Woodside Energy Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Woodside Energy Group 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 Woodside Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Woodside Energy Group has no effect on the direction of PennantPark Investment i.e., PennantPark Investment and Woodside Energy go up and down completely randomly.
Pair Corralation between PennantPark Investment and Woodside Energy
Assuming the 90 days horizon PennantPark Investment is expected to generate 2.3 times less return on investment than Woodside Energy. In addition to that, PennantPark Investment is 1.37 times more volatile than Woodside Energy Group. It trades about 0.03 of its total potential returns per unit of risk. Woodside Energy Group is currently generating about 0.1 per unit of volatility. If you would invest 1,435 in Woodside Energy Group on September 2, 2024 and sell it today you would earn a total of 53.00 from holding Woodside Energy Group or generate 3.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PennantPark Investment vs. Woodside Energy Group
Performance |
| Timeline |
| PennantPark Investment |
| Woodside Energy Group |
PennantPark Investment and Woodside Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PennantPark Investment and Woodside Energy
The main advantage of trading using opposite PennantPark Investment and Woodside Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PennantPark Investment position performs unexpectedly, Woodside Energy 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 Woodside Energy will offset losses from the drop in Woodside Energy's long position.| PennantPark Investment vs. Ameriprise Financial | PennantPark Investment vs. Ares Management Corp | PennantPark Investment vs. Superior Plus Corp | PennantPark Investment vs. NMI Holdings |
| Woodside Energy vs. EAT WELL INVESTMENT | Woodside Energy vs. REINET INVESTMENTS SCA | Woodside Energy vs. PennantPark Investment | Woodside Energy vs. ECHO INVESTMENT ZY |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |