Correlation Between Carlyle and PennantPark Floating
Can any of the company-specific risk be diversified away by investing in both Carlyle and PennantPark Floating 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 Carlyle and PennantPark Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carlyle Group and PennantPark Floating Rate, you can compare the effects of market volatilities on Carlyle and PennantPark Floating 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 Carlyle with a short position of PennantPark Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carlyle and PennantPark Floating.
Diversification Opportunities for Carlyle and PennantPark Floating
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Carlyle and PennantPark is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Carlyle Group and PennantPark Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PennantPark Floating Rate and Carlyle 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 Carlyle Group are associated (or correlated) with PennantPark Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PennantPark Floating Rate has no effect on the direction of Carlyle i.e., Carlyle and PennantPark Floating go up and down completely randomly.
Pair Corralation between Carlyle and PennantPark Floating
Allowing for the 90-day total investment horizon Carlyle Group is expected to generate 2.55 times more return on investment than PennantPark Floating. However, Carlyle is 2.55 times more volatile than PennantPark Floating Rate. It trades about 0.12 of its potential returns per unit of risk. PennantPark Floating Rate is currently generating about 0.07 per unit of risk. If you would invest 2,772 in Carlyle Group on September 1, 2024 and sell it today you would earn a total of 2,551 from holding Carlyle Group or generate 92.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Carlyle Group vs. PennantPark Floating Rate
Performance |
| Timeline |
| Carlyle Group |
| PennantPark Floating Rate |
Carlyle and PennantPark Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carlyle and PennantPark Floating
The main advantage of trading using opposite Carlyle and PennantPark Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carlyle position performs unexpectedly, PennantPark Floating 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 PennantPark Floating will offset losses from the drop in PennantPark Floating's long position.| Carlyle vs. Apollo Global Management | Carlyle vs. Blackstone Group | Carlyle vs. Brookfield Asset Management | Carlyle vs. Ares Management LP |
| PennantPark Floating vs. Visa Class A | PennantPark Floating vs. Diamond Hill Investment | PennantPark Floating vs. Distoken Acquisition | PennantPark Floating vs. Associated Capital Group |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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