Correlation Between Uber Technologies and PennantPark Floating
Can any of the company-specific risk be diversified away by investing in both Uber Technologies 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 Uber Technologies and PennantPark Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Uber Technologies and PennantPark Floating Rate, you can compare the effects of market volatilities on Uber Technologies 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 Uber Technologies with a short position of PennantPark Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uber Technologies and PennantPark Floating.
Diversification Opportunities for Uber Technologies and PennantPark Floating
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Uber and PennantPark is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Uber Technologies 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 Uber Technologies 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 Uber Technologies 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 Uber Technologies i.e., Uber Technologies and PennantPark Floating go up and down completely randomly.
Pair Corralation between Uber Technologies and PennantPark Floating
Given the investment horizon of 90 days Uber Technologies is expected to under-perform the PennantPark Floating. In addition to that, Uber Technologies is 3.25 times more volatile than PennantPark Floating Rate. It trades about -0.13 of its total potential returns per unit of risk. PennantPark Floating Rate is currently generating about -0.14 per unit of volatility. If you would invest 1,136 in PennantPark Floating Rate on August 26, 2024 and sell it today you would lose (29.00) from holding PennantPark Floating Rate or give up 2.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Uber Technologies vs. PennantPark Floating Rate
Performance |
| Timeline |
| Uber Technologies |
| PennantPark Floating Rate |
Uber Technologies and PennantPark Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Uber Technologies and PennantPark Floating
The main advantage of trading using opposite Uber Technologies and PennantPark Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uber Technologies 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.| Uber Technologies vs. Zoom Video Communications | Uber Technologies vs. Snowflake | Uber Technologies vs. Workday | Uber Technologies vs. C3 Ai Inc |
| PennantPark Floating vs. PowerUp Acquisition Corp | PennantPark Floating vs. Aurora Innovation | PennantPark Floating vs. HUMANA INC | PennantPark Floating vs. Aquagold International |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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