Correlation Between American Assets and Cresud SACIF

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Can any of the company-specific risk be diversified away by investing in both American Assets 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 American Assets and Cresud SACIF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Assets Trust and Cresud SACIF y, you can compare the effects of market volatilities on American Assets 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 American Assets with a short position of Cresud SACIF. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Assets and Cresud SACIF.

Diversification Opportunities for American Assets and Cresud SACIF

0.32
  Correlation Coefficient

Weak diversification

The 3 months correlation between American and Cresud is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding American Assets Trust 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 American Assets 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 American Assets Trust 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 American Assets i.e., American Assets and Cresud SACIF go up and down completely randomly.

Pair Corralation between American Assets and Cresud SACIF

Considering the 90-day investment horizon American Assets Trust is expected to generate 0.74 times more return on investment than Cresud SACIF. However, American Assets Trust is 1.35 times less risky than Cresud SACIF. It trades about -0.29 of its potential returns per unit of risk. Cresud SACIF y is currently generating about -0.38 per unit of risk. If you would invest  2,492  in American Assets Trust on November 27, 2024 and sell it today you would lose (287.00) from holding American Assets Trust or give up 11.52% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

American Assets Trust  vs.  Cresud SACIF y

 Performance 
       Timeline  
American Assets Trust 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days American Assets Trust has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in March 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.
Cresud SACIF y 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
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 fairly strong basic indicators, Cresud SACIF is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

American Assets and Cresud SACIF Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with American Assets and Cresud SACIF

The main advantage of trading using opposite American Assets and Cresud SACIF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Assets 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 American Assets Trust 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.

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