Correlation Between PennantPark Floating and First Ship
Can any of the company-specific risk be diversified away by investing in both PennantPark Floating and First Ship 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 First Ship 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 First Ship Lease, you can compare the effects of market volatilities on PennantPark Floating and First Ship 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 First Ship. Check out your portfolio center. Please also check ongoing floating volatility patterns of PennantPark Floating and First Ship.
Diversification Opportunities for PennantPark Floating and First Ship
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between PennantPark and First is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding PennantPark Floating Rate and First Ship Lease in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Ship Lease 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 First Ship. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Ship Lease has no effect on the direction of PennantPark Floating i.e., PennantPark Floating and First Ship go up and down completely randomly.
Pair Corralation between PennantPark Floating and First Ship
If you would invest 4.00 in First Ship Lease on August 30, 2024 and sell it today you would earn a total of 0.00 from holding First Ship Lease or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PennantPark Floating Rate vs. First Ship Lease
Performance |
| Timeline |
| PennantPark Floating Rate |
| First Ship Lease |
PennantPark Floating and First Ship Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PennantPark Floating and First Ship
The main advantage of trading using opposite PennantPark Floating and First Ship positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PennantPark Floating position performs unexpectedly, First Ship 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 First Ship will offset losses from the drop in First Ship's long position.| PennantPark Floating vs. TPG Inc | PennantPark Floating vs. Carlyle Secured Lending | PennantPark Floating vs. Brookfield Corp |
| First Ship vs. United Rentals | First Ship vs. Ashtead Group plc | First Ship vs. AerCap Holdings NV | First Ship vs. Fortress Transp Infra |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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