Correlation Between Hf Foods and PennantPark Investment
Can any of the company-specific risk be diversified away by investing in both Hf Foods and PennantPark 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 Hf Foods and PennantPark Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hf Foods Group and PennantPark Investment, you can compare the effects of market volatilities on Hf Foods and PennantPark 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 Hf Foods with a short position of PennantPark Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hf Foods and PennantPark Investment.
Diversification Opportunities for Hf Foods and PennantPark Investment
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between HFFG and PennantPark is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Hf Foods Group and PennantPark Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PennantPark Investment and Hf Foods 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 Hf Foods Group are associated (or correlated) with PennantPark Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PennantPark Investment has no effect on the direction of Hf Foods i.e., Hf Foods and PennantPark Investment go up and down completely randomly.
Pair Corralation between Hf Foods and PennantPark Investment
Given the investment horizon of 90 days Hf Foods Group is expected to generate 1.42 times more return on investment than PennantPark Investment. However, Hf Foods is 1.42 times more volatile than PennantPark Investment. It trades about 0.05 of its potential returns per unit of risk. PennantPark Investment is currently generating about 0.0 per unit of risk. If you would invest 353.00 in Hf Foods Group on August 28, 2024 and sell it today you would earn a total of 6.00 from holding Hf Foods Group or generate 1.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hf Foods Group vs. PennantPark Investment
Performance |
| Timeline |
| Hf Foods Group |
| PennantPark Investment |
Hf Foods and PennantPark Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hf Foods and PennantPark Investment
The main advantage of trading using opposite Hf Foods and PennantPark Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hf Foods position performs unexpectedly, PennantPark 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 PennantPark Investment will offset losses from the drop in PennantPark Investment's long position.| Hf Foods vs. Innovative Food Hldg | Hf Foods vs. Calavo Growers | Hf Foods vs. The Chefs Warehouse | Hf Foods vs. AMCON Distributing |
| PennantPark Investment vs. Sixth Street Specialty | PennantPark Investment vs. New Mountain Finance | PennantPark Investment vs. Carlyle Secured Lending | PennantPark Investment vs. BlackRock TCP 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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