Correlation Between Cresud SACIF and Dfa Targeted

Can any of the company-specific risk be diversified away by investing in both Cresud SACIF and Dfa Targeted 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 Cresud SACIF and Dfa Targeted into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Cresud SACIF y and Dfa Targeted Credit, you can compare the effects of market volatilities on Cresud SACIF and Dfa Targeted 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 Cresud SACIF with a short position of Dfa Targeted. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cresud SACIF and Dfa Targeted.

Diversification Opportunities for Cresud SACIF and Dfa Targeted

0.9

Correlation Coefficient

Cresud SACIF  Dfa Targeted

Almost no diversification

The 3 months correlation between Cresud and Dfa is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Cresud SACIF y and Dfa Targeted Credit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dfa Targeted Credit and Cresud SACIF 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 Cresud SACIF y are associated (or correlated) with Dfa Targeted. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dfa Targeted Credit has no effect on the direction of Cresud SACIF i.e., Cresud SACIF and Dfa Targeted go up and down completely randomly.

Pair Corralation between Cresud SACIF and Dfa Targeted

Assuming the 90 days horizon Cresud SACIF y is expected to generate 65.35 times more return on investment than Dfa Targeted. However, Cresud SACIF is 65.35 times more volatile than Dfa Targeted Credit. It trades about 0.2 of its potential returns per unit of risk. Dfa Targeted Credit is currently generating about 0.36 per unit of risk. If you would invest  842.00  in Cresud SACIF y on October 22, 2024 and sell it today you would earn a total of  367.00  from holding Cresud SACIF y or generate 43.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	98.39%
Values	Daily Returns

Cresud SACIF y  vs.  Dfa Targeted Credit

Cresud SACIF y

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Cresud SACIF y are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile basic indicators, Cresud SACIF showed solid returns over the last few months and may actually be approaching a breakup point.

Dfa Targeted Credit

Risk-Adjusted Performance

28 of 100

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Dfa Targeted Credit are ranked lower than 28 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Dfa Targeted is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Cresud SACIF and Dfa Targeted

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

The idea behind Cresud SACIF y and Dfa Targeted Credit 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.