Correlation Between Chiba Bank and PennantPark Floating
Can any of the company-specific risk be diversified away by investing in both Chiba Bank 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 Chiba Bank and PennantPark Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chiba Bank Ltd and PennantPark Floating Rate, you can compare the effects of market volatilities on Chiba Bank 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 Chiba Bank with a short position of PennantPark Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chiba Bank and PennantPark Floating.
Diversification Opportunities for Chiba Bank and PennantPark Floating
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Chiba and PennantPark is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Chiba Bank Ltd 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 Chiba Bank 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 Chiba Bank Ltd 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 Chiba Bank i.e., Chiba Bank and PennantPark Floating go up and down completely randomly.
Pair Corralation between Chiba Bank and PennantPark Floating
If you would invest 3,768 in Chiba Bank Ltd on August 27, 2024 and sell it today you would earn a total of 0.00 from holding Chiba Bank Ltd or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chiba Bank Ltd vs. PennantPark Floating Rate
Performance |
| Timeline |
| Chiba Bank |
| PennantPark Floating Rate |
Chiba Bank and PennantPark Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chiba Bank and PennantPark Floating
The main advantage of trading using opposite Chiba Bank and PennantPark Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chiba Bank 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.| Chiba Bank vs. First Hawaiian | Chiba Bank vs. Central Pacific Financial | Chiba Bank vs. Territorial Bancorp | Chiba Bank vs. Comerica |
| PennantPark Floating vs. Gladstone Investment | PennantPark Floating vs. Horizon Technology Finance | PennantPark Floating vs. Stellus Capital Investment | PennantPark Floating vs. Prospect Capital |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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