Correlation Between EvoAir Holdings and PennantPark Floating
Can any of the company-specific risk be diversified away by investing in both EvoAir Holdings 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 EvoAir Holdings and PennantPark Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EvoAir Holdings and PennantPark Floating Rate, you can compare the effects of market volatilities on EvoAir Holdings 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 EvoAir Holdings with a short position of PennantPark Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of EvoAir Holdings and PennantPark Floating.
Diversification Opportunities for EvoAir Holdings and PennantPark Floating
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between EvoAir and PennantPark is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding EvoAir Holdings 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 EvoAir Holdings 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 EvoAir Holdings 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 EvoAir Holdings i.e., EvoAir Holdings and PennantPark Floating go up and down completely randomly.
Pair Corralation between EvoAir Holdings and PennantPark Floating
Assuming the 90 days horizon EvoAir Holdings is expected to generate 5.48 times less return on investment than PennantPark Floating. But when comparing it to its historical volatility, EvoAir Holdings is 6.89 times less risky than PennantPark Floating. It trades about 0.04 of its potential returns per unit of risk. PennantPark Floating Rate is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 921.00 in PennantPark Floating Rate on September 3, 2024 and sell it today you would earn a total of 195.00 from holding PennantPark Floating Rate or generate 21.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
EvoAir Holdings vs. PennantPark Floating Rate
Performance |
| Timeline |
| EvoAir Holdings |
| PennantPark Floating Rate |
EvoAir Holdings and PennantPark Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EvoAir Holdings and PennantPark Floating
The main advantage of trading using opposite EvoAir Holdings and PennantPark Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EvoAir Holdings 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.| EvoAir Holdings vs. Luxfer Holdings PLC | EvoAir Holdings vs. Origin Materials | EvoAir Holdings vs. Verra Mobility Corp | EvoAir Holdings vs. Saia Inc |
| PennantPark Floating vs. Federated Premier Municipal | PennantPark Floating vs. Blackrock Muniyield | PennantPark Floating vs. Federated Investors B | PennantPark Floating vs. SEI Investments |
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.
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