Correlation Between Cresud SACIF and NETGEAR
Can any of the company-specific risk be diversified away by investing in both Cresud SACIF and NETGEAR 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 NETGEAR 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 NETGEAR, you can compare the effects of market volatilities on Cresud SACIF and NETGEAR 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 NETGEAR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cresud SACIF and NETGEAR.
Diversification Opportunities for Cresud SACIF and NETGEAR
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Cresud and NETGEAR is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Cresud SACIF y and NETGEAR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NETGEAR 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 NETGEAR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NETGEAR has no effect on the direction of Cresud SACIF i.e., Cresud SACIF and NETGEAR go up and down completely randomly.
Pair Corralation between Cresud SACIF and NETGEAR
Assuming the 90 days horizon Cresud SACIF is expected to generate 1.03 times less return on investment than NETGEAR. But when comparing it to its historical volatility, Cresud SACIF y is 1.32 times less risky than NETGEAR. It trades about 0.18 of its potential returns per unit of risk. NETGEAR is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,592 in NETGEAR on October 26, 2024 and sell it today you would earn a total of 1,224 from holding NETGEAR or generate 76.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.19% |
| Values | Daily Returns |
Cresud SACIF y vs. NETGEAR
Performance |
| Timeline |
| Cresud SACIF y |
| NETGEAR |
Cresud SACIF and NETGEAR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cresud SACIF and NETGEAR
The main advantage of trading using opposite Cresud SACIF and NETGEAR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cresud SACIF position performs unexpectedly, NETGEAR 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 NETGEAR will offset losses from the drop in NETGEAR's long position.| Cresud SACIF vs. Griffon | Cresud SACIF vs. Matthews International | Cresud SACIF vs. Valmont Industries | Cresud SACIF vs. Steel Partners Holdings |
| NETGEAR vs. Comtech Telecommunications Corp | NETGEAR vs. KVH Industries | NETGEAR vs. Silicom | NETGEAR vs. Knowles Cor |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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