Correlation Between Cresud SA and Ledesma SAAI
Can any of the company-specific risk be diversified away by investing in both Cresud SA and Ledesma SAAI 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 SA and Ledesma SAAI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cresud SA and Ledesma SAAI, you can compare the effects of market volatilities on Cresud SA and Ledesma SAAI 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 SA with a short position of Ledesma SAAI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cresud SA and Ledesma SAAI.
Diversification Opportunities for Cresud SA and Ledesma SAAI
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Cresud and Ledesma is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Cresud SA and Ledesma SAAI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ledesma SAAI and Cresud SA 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 SA are associated (or correlated) with Ledesma SAAI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ledesma SAAI has no effect on the direction of Cresud SA i.e., Cresud SA and Ledesma SAAI go up and down completely randomly.
Pair Corralation between Cresud SA and Ledesma SAAI
Assuming the 90 days trading horizon Cresud SA is expected to generate 1.55 times more return on investment than Ledesma SAAI. However, Cresud SA is 1.55 times more volatile than Ledesma SAAI. It trades about -0.01 of its potential returns per unit of risk. Ledesma SAAI is currently generating about -0.08 per unit of risk. If you would invest 144,000 in Cresud SA on October 20, 2024 and sell it today you would lose (1,500) from holding Cresud SA or give up 1.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.0% |
| Values | Daily Returns |
Cresud SA vs. Ledesma SAAI
Performance |
| Timeline |
| Cresud SA |
| Ledesma SAAI |
Cresud SA and Ledesma SAAI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cresud SA and Ledesma SAAI
The main advantage of trading using opposite Cresud SA and Ledesma SAAI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cresud SA position performs unexpectedly, Ledesma SAAI 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 Ledesma SAAI will offset losses from the drop in Ledesma SAAI's long position.| Cresud SA vs. Molinos Agro SA | Cresud SA vs. San Miguel AG | Cresud SA vs. Ledesma SAAI | Cresud SA vs. Inversora Juramento SA |
| Ledesma SAAI vs. Molinos Agro SA | Ledesma SAAI vs. Cresud SA | Ledesma SAAI vs. San Miguel AG | Ledesma SAAI vs. Inversora Juramento SA |
Check out your portfolio center.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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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