Correlation Between PennantPark Floating and Intuitive Machines
Can any of the company-specific risk be diversified away by investing in both PennantPark Floating and Intuitive Machines 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 Intuitive Machines 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 Intuitive Machines, you can compare the effects of market volatilities on PennantPark Floating and Intuitive Machines 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 Intuitive Machines. Check out your portfolio center. Please also check ongoing floating volatility patterns of PennantPark Floating and Intuitive Machines.
Diversification Opportunities for PennantPark Floating and Intuitive Machines
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between PennantPark and Intuitive is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding PennantPark Floating Rate and Intuitive Machines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intuitive Machines 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 Intuitive Machines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intuitive Machines has no effect on the direction of PennantPark Floating i.e., PennantPark Floating and Intuitive Machines go up and down completely randomly.
Pair Corralation between PennantPark Floating and Intuitive Machines
Given the investment horizon of 90 days PennantPark Floating Rate is expected to under-perform the Intuitive Machines. But the stock apears to be less risky and, when comparing its historical volatility, PennantPark Floating Rate is 14.21 times less risky than Intuitive Machines. The stock trades about -0.18 of its potential returns per unit of risk. The Intuitive Machines is currently generating about 0.4 of returns per unit of risk over similar time horizon. If you would invest 262.00 in Intuitive Machines on August 28, 2024 and sell it today you would earn a total of 332.00 from holding Intuitive Machines or generate 126.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PennantPark Floating Rate vs. Intuitive Machines
Performance |
| Timeline |
| PennantPark Floating Rate |
| Intuitive Machines |
PennantPark Floating and Intuitive Machines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PennantPark Floating and Intuitive Machines
The main advantage of trading using opposite PennantPark Floating and Intuitive Machines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PennantPark Floating position performs unexpectedly, Intuitive Machines 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 Intuitive Machines will offset losses from the drop in Intuitive Machines' long position.| PennantPark Floating vs. Gladstone Investment | PennantPark Floating vs. Horizon Technology Finance | PennantPark Floating vs. Stellus Capital Investment | PennantPark Floating vs. Prospect Capital |
| Intuitive Machines vs. Sea | Intuitive Machines vs. Upper Street Marketing | Intuitive Machines vs. The Gap, | Intuitive Machines vs. Fast Retailing Co |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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