Correlation Between Ihuman and PennantPark Floating
Can any of the company-specific risk be diversified away by investing in both Ihuman 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 Ihuman and PennantPark Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ihuman Inc and PennantPark Floating Rate, you can compare the effects of market volatilities on Ihuman 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 Ihuman with a short position of PennantPark Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ihuman and PennantPark Floating.
Diversification Opportunities for Ihuman and PennantPark Floating
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ihuman and PennantPark is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Ihuman Inc 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 Ihuman 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 Ihuman Inc 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 Ihuman i.e., Ihuman and PennantPark Floating go up and down completely randomly.
Pair Corralation between Ihuman and PennantPark Floating
Allowing for the 90-day total investment horizon Ihuman Inc is expected to under-perform the PennantPark Floating. In addition to that, Ihuman is 3.87 times more volatile than PennantPark Floating Rate. It trades about -0.03 of its total potential returns per unit of risk. PennantPark Floating Rate is currently generating about 0.05 per unit of volatility. If you would invest 1,012 in PennantPark Floating Rate on September 2, 2024 and sell it today you would earn a total of 104.00 from holding PennantPark Floating Rate or generate 10.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ihuman Inc vs. PennantPark Floating Rate
Performance |
| Timeline |
| Ihuman Inc |
| PennantPark Floating Rate |
Ihuman and PennantPark Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ihuman and PennantPark Floating
The main advantage of trading using opposite Ihuman and PennantPark Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ihuman 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.| Ihuman vs. Wah Fu Education | Ihuman vs. Golden Sun Education | Ihuman vs. Elite Education Group | Ihuman vs. American Public Education |
| 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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