Correlation Between PennantPark Floating and Fly Leasing

Can any of the company-specific risk be diversified away by investing in both PennantPark Floating and Fly Leasing 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 Fly Leasing 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 Fly Leasing Limited, you can compare the effects of market volatilities on PennantPark Floating and Fly Leasing 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 Fly Leasing. Check out your portfolio center. Please also check ongoing floating volatility patterns of PennantPark Floating and Fly Leasing.

Diversification Opportunities for PennantPark Floating and Fly Leasing

0.0

Correlation Coefficient

PennantPark Floating  Fly Leasing

Pay attention - limited upside

The 3 months correlation between PennantPark and Fly is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding PennantPark Floating Rate and Fly Leasing Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fly Leasing Limited 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 Fly Leasing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fly Leasing Limited has no effect on the direction of PennantPark Floating i.e., PennantPark Floating and Fly Leasing go up and down completely randomly.

Pair Corralation between PennantPark Floating and Fly Leasing

If you would invest  978.00  in PennantPark Floating Rate on October 7, 2024 and sell it today you would earn a total of  131.00  from holding PennantPark Floating Rate or generate 13.39% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

PennantPark Floating Rate  vs.  Fly Leasing Limited

PennantPark Floating Rate

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PennantPark Floating Rate has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable essential indicators, PennantPark Floating is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Fly Leasing Limited

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fly Leasing Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong essential indicators, Fly Leasing is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with PennantPark Floating and Fly Leasing

The main advantage of trading using opposite PennantPark Floating and Fly Leasing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PennantPark Floating position performs unexpectedly, Fly Leasing 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 Fly Leasing will offset losses from the drop in Fly Leasing's long position.

The idea behind PennantPark Floating Rate and Fly Leasing Limited pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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.