Correlation Between Cresud SACIF and Mfs Total

Can any of the company-specific risk be diversified away by investing in both Cresud SACIF and Mfs Total 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 Mfs Total 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 Mfs Total Return, you can compare the effects of market volatilities on Cresud SACIF and Mfs Total 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 Mfs Total. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cresud SACIF and Mfs Total.

Diversification Opportunities for Cresud SACIF and Mfs Total

-0.2

Correlation Coefficient

Cresud SACIF  Mfs Total

Good diversification

The 3 months correlation between Cresud and Mfs is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Cresud SACIF y and Mfs Total Return in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Total Return 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 Mfs Total. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Total Return has no effect on the direction of Cresud SACIF i.e., Cresud SACIF and Mfs Total go up and down completely randomly.

Pair Corralation between Cresud SACIF and Mfs Total

Assuming the 90 days horizon Cresud SACIF y is expected to generate 11.61 times more return on investment than Mfs Total. However, Cresud SACIF is 11.61 times more volatile than Mfs Total Return. It trades about 0.02 of its potential returns per unit of risk. Mfs Total Return is currently generating about -0.47 per unit of risk. If you would invest  1,339  in Cresud SACIF y on October 6, 2024 and sell it today you would earn a total of  5.00  from holding Cresud SACIF y or generate 0.37% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.24%
Values	Daily Returns

Cresud SACIF y  vs.  Mfs Total Return

Cresud SACIF y

Risk-Adjusted Performance

20 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Cresud SACIF y are ranked lower than 20 (%) 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.

Mfs Total Return

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mfs Total Return has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward-looking signals, Mfs Total 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 Mfs Total

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

The idea behind Cresud SACIF y and Mfs Total Return 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.