Correlation Between PennantPark Floating and RadNet
Can any of the company-specific risk be diversified away by investing in both PennantPark Floating and RadNet 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 RadNet 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 RadNet Inc, you can compare the effects of market volatilities on PennantPark Floating and RadNet 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 RadNet. Check out your portfolio center. Please also check ongoing floating volatility patterns of PennantPark Floating and RadNet.
Diversification Opportunities for PennantPark Floating and RadNet
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between PennantPark and RadNet is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding PennantPark Floating Rate and RadNet Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RadNet Inc 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 RadNet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RadNet Inc has no effect on the direction of PennantPark Floating i.e., PennantPark Floating and RadNet go up and down completely randomly.
Pair Corralation between PennantPark Floating and RadNet
Given the investment horizon of 90 days PennantPark Floating is expected to generate 6.63 times less return on investment than RadNet. But when comparing it to its historical volatility, PennantPark Floating Rate is 1.9 times less risky than RadNet. It trades about 0.03 of its potential returns per unit of risk. RadNet Inc is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 2,105 in RadNet Inc on August 24, 2024 and sell it today you would earn a total of 6,099 from holding RadNet Inc or generate 289.74% 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. RadNet Inc
Performance |
| Timeline |
| PennantPark Floating Rate |
| RadNet Inc |
PennantPark Floating and RadNet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PennantPark Floating and RadNet
The main advantage of trading using opposite PennantPark Floating and RadNet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PennantPark Floating position performs unexpectedly, RadNet 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 RadNet will offset losses from the drop in RadNet'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 |
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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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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