Correlation Between TFI International and PennantPark Floating
Can any of the company-specific risk be diversified away by investing in both TFI International and PennantPark Floating 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 TFI International and PennantPark Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TFI International and PennantPark Floating Rate, you can compare the effects of market volatilities on TFI International and PennantPark Floating 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 TFI International with a short position of PennantPark Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of TFI International and PennantPark Floating.
Diversification Opportunities for TFI International and PennantPark Floating
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between TFI and PennantPark is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding TFI International and PennantPark Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PennantPark Floating Rate and TFI International 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 TFI International are associated (or correlated) with PennantPark Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PennantPark Floating Rate has no effect on the direction of TFI International i.e., TFI International and PennantPark Floating go up and down completely randomly.
Pair Corralation between TFI International and PennantPark Floating
Given the investment horizon of 90 days TFI International is expected to generate 2.02 times more return on investment than PennantPark Floating. However, TFI International is 2.02 times more volatile than PennantPark Floating Rate. It trades about 0.07 of its potential returns per unit of risk. PennantPark Floating Rate is currently generating about 0.05 per unit of risk. If you would invest 11,460 in TFI International on September 2, 2024 and sell it today you would earn a total of 3,708 from holding TFI International or generate 32.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
TFI International vs. PennantPark Floating Rate
Performance |
| Timeline |
| TFI International |
| PennantPark Floating Rate |
TFI International and PennantPark Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TFI International and PennantPark Floating
The main advantage of trading using opposite TFI International and PennantPark Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TFI International position performs unexpectedly, PennantPark Floating 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 PennantPark Floating will offset losses from the drop in PennantPark Floating's long position.| TFI International vs. Old Dominion Freight | TFI International vs. ArcBest Corp | TFI International vs. Marten Transport | TFI International vs. Werner Enterprises |
| PennantPark Floating vs. Gladstone Investment | PennantPark Floating vs. Horizon Technology Finance | PennantPark Floating vs. Stellus Capital Investment | PennantPark Floating vs. Prospect Capital |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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