Correlation Between PennantPark Floating and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both PennantPark Floating and Eaton Vance 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 Eaton Vance 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 Eaton Vance Municipal, you can compare the effects of market volatilities on PennantPark Floating and Eaton Vance 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 Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of PennantPark Floating and Eaton Vance.
Diversification Opportunities for PennantPark Floating and Eaton Vance
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between PennantPark and Eaton is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding PennantPark Floating Rate and Eaton Vance Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Municipal 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 Eaton Vance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eaton Vance Municipal has no effect on the direction of PennantPark Floating i.e., PennantPark Floating and Eaton Vance go up and down completely randomly.
Pair Corralation between PennantPark Floating and Eaton Vance
Given the investment horizon of 90 days PennantPark Floating Rate is expected to generate 1.37 times more return on investment than Eaton Vance. However, PennantPark Floating is 1.37 times more volatile than Eaton Vance Municipal. It trades about 0.18 of its potential returns per unit of risk. Eaton Vance Municipal is currently generating about 0.16 per unit of risk. If you would invest 1,089 in PennantPark Floating Rate on November 3, 2024 and sell it today you would earn a total of 34.00 from holding PennantPark Floating Rate or generate 3.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
PennantPark Floating Rate vs. Eaton Vance Municipal
Performance |
| Timeline |
| PennantPark Floating Rate |
| Eaton Vance Municipal |
PennantPark Floating and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PennantPark Floating and Eaton Vance
The main advantage of trading using opposite PennantPark Floating and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PennantPark Floating position performs unexpectedly, Eaton Vance 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 Eaton Vance will offset losses from the drop in Eaton Vance'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 |
| Eaton Vance vs. Munivest Fund | Eaton Vance vs. Blackrock Muniyield Quality | Eaton Vance vs. Blackrock Muniyield Quality | Eaton Vance vs. Blackrock Muniholdings Closed |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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