Correlation Between PennantPark Floating and Apollo Global
Can any of the company-specific risk be diversified away by investing in both PennantPark Floating and Apollo Global 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 Apollo Global 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 Apollo Global Management, you can compare the effects of market volatilities on PennantPark Floating and Apollo Global 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 Apollo Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of PennantPark Floating and Apollo Global.
Diversification Opportunities for PennantPark Floating and Apollo Global
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between PennantPark and Apollo is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding PennantPark Floating Rate and Apollo Global Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apollo Global Management 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 Apollo Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apollo Global Management has no effect on the direction of PennantPark Floating i.e., PennantPark Floating and Apollo Global go up and down completely randomly.
Pair Corralation between PennantPark Floating and Apollo Global
Given the investment horizon of 90 days PennantPark Floating is expected to generate 6.3 times less return on investment than Apollo Global. But when comparing it to its historical volatility, PennantPark Floating Rate is 1.53 times less risky than Apollo Global. It trades about 0.02 of its potential returns per unit of risk. Apollo Global Management is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 6,655 in Apollo Global Management on October 5, 2024 and sell it today you would earn a total of 9,931 from holding Apollo Global Management or generate 149.23% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
PennantPark Floating Rate vs. Apollo Global Management
Performance |
Timeline |
PennantPark Floating Rate |
Apollo Global Management |
PennantPark Floating and Apollo Global Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with PennantPark Floating and Apollo Global
The main advantage of trading using opposite PennantPark Floating and Apollo Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PennantPark Floating position performs unexpectedly, Apollo Global 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 Apollo Global will offset losses from the drop in Apollo Global'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 |
Apollo Global vs. Carlyle Group | Apollo Global vs. Blackstone Group | Apollo Global vs. Brookfield Asset Management | Apollo Global vs. Ares Management LP |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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