Correlation Between PennantPark Floating and Cracker Barrel
Can any of the company-specific risk be diversified away by investing in both PennantPark Floating and Cracker Barrel 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 PennantPark Floating and Cracker Barrel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PennantPark Floating Rate and Cracker Barrel Old, you can compare the effects of market volatilities on PennantPark Floating and Cracker Barrel 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 PennantPark Floating with a short position of Cracker Barrel. Check out your portfolio center. Please also check ongoing floating volatility patterns of PennantPark Floating and Cracker Barrel.
Diversification Opportunities for PennantPark Floating and Cracker Barrel
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between PennantPark and Cracker is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding PennantPark Floating Rate and Cracker Barrel Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cracker Barrel Old and PennantPark Floating 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 PennantPark Floating Rate are associated (or correlated) with Cracker Barrel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cracker Barrel Old has no effect on the direction of PennantPark Floating i.e., PennantPark Floating and Cracker Barrel go up and down completely randomly.
Pair Corralation between PennantPark Floating and Cracker Barrel
Given the investment horizon of 90 days PennantPark Floating Rate is expected to generate 0.35 times more return on investment than Cracker Barrel. However, PennantPark Floating Rate is 2.86 times less risky than Cracker Barrel. It trades about 0.07 of its potential returns per unit of risk. Cracker Barrel Old is currently generating about -0.05 per unit of risk. If you would invest 809.00 in PennantPark Floating Rate on December 4, 2024 and sell it today you would earn a total of 304.00 from holding PennantPark Floating Rate or generate 37.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PennantPark Floating Rate vs. Cracker Barrel Old
Performance |
| Timeline |
| PennantPark Floating Rate |
| Cracker Barrel Old |
PennantPark Floating and Cracker Barrel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PennantPark Floating and Cracker Barrel
The main advantage of trading using opposite PennantPark Floating and Cracker Barrel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PennantPark Floating position performs unexpectedly, Cracker Barrel 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 Cracker Barrel will offset losses from the drop in Cracker Barrel's long position.| PennantPark Floating vs. Gladstone Investment | PennantPark Floating vs. Horizon Technology Finance | PennantPark Floating vs. Stellus Capital Investment | PennantPark Floating vs. Prospect Capital |
| Cracker Barrel vs. Brinker International | Cracker Barrel vs. BJs Restaurants | Cracker Barrel vs. Texas Roadhouse | Cracker Barrel vs. Papa Johns International |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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