Correlation Between Compass Diversified and Cresud SACIF

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

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

Diversification Opportunities for Compass Diversified and Cresud SACIF

-0.04

Correlation Coefficient

Compass Diversified  Cresud SACIF

Good diversification

The 3 months correlation between Compass and Cresud is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Compass Diversified Holdings 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 Compass Diversified 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 Compass Diversified Holdings 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 Compass Diversified i.e., Compass Diversified and Cresud SACIF go up and down completely randomly.

Pair Corralation between Compass Diversified and Cresud SACIF

Given the investment horizon of 90 days Compass Diversified Holdings is expected to under-perform the Cresud SACIF. In addition to that, Compass Diversified is 4.16 times more volatile than Cresud SACIF y. It trades about -0.11 of its total potential returns per unit of risk. Cresud SACIF y is currently generating about 0.05 per unit of volatility. If you would invest  1,083  in Cresud SACIF y on May 1, 2025 and sell it today you would earn a total of  64.00  from holding Cresud SACIF y or generate 5.91% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Compass Diversified Holdings  vs.  Cresud SACIF y

Compass Diversified

Risk-Adjusted Performance

Very Weak

Over the last 90 days Compass Diversified Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's fundamental indicators remain fairly strong which may send shares a bit higher in August 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Cresud SACIF y

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Cresud SACIF y are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, Cresud SACIF may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Compass Diversified and Cresud SACIF

The main advantage of trading using opposite Compass Diversified and Cresud SACIF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Compass Diversified 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 Compass Diversified Holdings 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .