Correlation Between PennyMac Mortgage and JLF INVESTMENT
Can any of the company-specific risk be diversified away by investing in both PennyMac Mortgage and JLF INVESTMENT 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 PennyMac Mortgage and JLF INVESTMENT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PennyMac Mortgage Investment and JLF INVESTMENT, you can compare the effects of market volatilities on PennyMac Mortgage and JLF INVESTMENT 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 PennyMac Mortgage with a short position of JLF INVESTMENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of PennyMac Mortgage and JLF INVESTMENT.
Diversification Opportunities for PennyMac Mortgage and JLF INVESTMENT
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between PennyMac and JLF is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding PennyMac Mortgage Investment and JLF INVESTMENT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JLF INVESTMENT and PennyMac Mortgage 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 PennyMac Mortgage Investment are associated (or correlated) with JLF INVESTMENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JLF INVESTMENT has no effect on the direction of PennyMac Mortgage i.e., PennyMac Mortgage and JLF INVESTMENT go up and down completely randomly.
Pair Corralation between PennyMac Mortgage and JLF INVESTMENT
If you would invest 1,241 in PennyMac Mortgage Investment on September 20, 2024 and sell it today you would earn a total of 39.00 from holding PennyMac Mortgage Investment or generate 3.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PennyMac Mortgage Investment vs. JLF INVESTMENT
Performance |
| Timeline |
| PennyMac Mortgage |
| JLF INVESTMENT |
PennyMac Mortgage and JLF INVESTMENT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PennyMac Mortgage and JLF INVESTMENT
The main advantage of trading using opposite PennyMac Mortgage and JLF INVESTMENT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PennyMac Mortgage position performs unexpectedly, JLF INVESTMENT 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 JLF INVESTMENT will offset losses from the drop in JLF INVESTMENT's long position.| PennyMac Mortgage vs. Superior Plus Corp | PennyMac Mortgage vs. SIVERS SEMICONDUCTORS AB | PennyMac Mortgage vs. CHINA HUARONG ENERHD 50 | PennyMac Mortgage vs. NORDIC HALIBUT AS |
| JLF INVESTMENT vs. Apple Inc | JLF INVESTMENT vs. Apple Inc | JLF INVESTMENT vs. Apple Inc | JLF INVESTMENT vs. Microsoft |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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