Correlation Between PennantPark Floating and PEPSICO
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By analyzing existing cross correlation between PennantPark Floating Rate and PEPSICO INC, you can compare the effects of market volatilities on PennantPark Floating and PEPSICO 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 PEPSICO. Check out your portfolio center. Please also check ongoing floating volatility patterns of PennantPark Floating and PEPSICO.
Diversification Opportunities for PennantPark Floating and PEPSICO
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between PennantPark and PEPSICO is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding PennantPark Floating Rate and PEPSICO INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PEPSICO 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 PEPSICO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PEPSICO INC has no effect on the direction of PennantPark Floating i.e., PennantPark Floating and PEPSICO go up and down completely randomly.
Pair Corralation between PennantPark Floating and PEPSICO
Given the investment horizon of 90 days PennantPark Floating Rate is expected to generate 0.93 times more return on investment than PEPSICO. However, PennantPark Floating Rate is 1.08 times less risky than PEPSICO. It trades about -0.01 of its potential returns per unit of risk. PEPSICO INC is currently generating about -0.07 per unit of risk. If you would invest 1,112 in PennantPark Floating Rate on September 4, 2024 and sell it today you would lose (6.00) from holding PennantPark Floating Rate or give up 0.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 57.81% |
| Values | Daily Returns |
PennantPark Floating Rate vs. PEPSICO INC
Performance |
| Timeline |
| PennantPark Floating Rate |
| PEPSICO INC |
PennantPark Floating and PEPSICO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PennantPark Floating and PEPSICO
The main advantage of trading using opposite PennantPark Floating and PEPSICO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PennantPark Floating position performs unexpectedly, PEPSICO 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 PEPSICO will offset losses from the drop in PEPSICO's long position.| PennantPark Floating vs. Visa Class A | PennantPark Floating vs. Diamond Hill Investment | PennantPark Floating vs. Associated Capital Group | PennantPark Floating vs. Brookfield Corp |
| PEPSICO vs. Equinix | PEPSICO vs. PennantPark Floating Rate | PEPSICO vs. Mediag3 | PEPSICO vs. Summit Hotel Properties |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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