Correlation Between Sunrun and Cresud SACIF

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

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

Diversification Opportunities for Sunrun and Cresud SACIF

0.9

Correlation Coefficient

Sunrun  Cresud SACIF

Almost no diversification

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

Pair Corralation between Sunrun and Cresud SACIF

Considering the 90-day investment horizon Sunrun Inc is expected to under-perform the Cresud SACIF. But the stock apears to be less risky and, when comparing its historical volatility, Sunrun Inc is 1.11 times less risky than Cresud SACIF. The stock trades about -0.14 of its potential returns per unit of risk. The Cresud SACIF y is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest  107.00  in Cresud SACIF y on December 28, 2024 and sell it today you would lose (18.00) from holding Cresud SACIF y or give up 16.82% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	98.36%
Values	Daily Returns

Sunrun Inc  vs.  Cresud SACIF y

Sunrun Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Sunrun Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Cresud SACIF y

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cresud SACIF y has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Pair Trading with Sunrun and Cresud SACIF

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

The idea behind Sunrun Inc and Cresud SACIF y 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.