Correlation Between Afrimat and Sasol
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By analyzing existing cross correlation between Afrimat and Sasol Ltd Bee, you can compare the effects of market volatilities on Afrimat and Sasol 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 Afrimat with a short position of Sasol. Check out your portfolio center. Please also check ongoing floating volatility patterns of Afrimat and Sasol.
Diversification Opportunities for Afrimat and Sasol
Weak diversification
The 3 months correlation between Afrimat and Sasol is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Afrimat and Sasol Ltd Bee in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sasol Ltd Bee and Afrimat 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 Afrimat are associated (or correlated) with Sasol. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sasol Ltd Bee has no effect on the direction of Afrimat i.e., Afrimat and Sasol go up and down completely randomly.
Pair Corralation between Afrimat and Sasol
Assuming the 90 days trading horizon Afrimat is expected to generate 2.71 times more return on investment than Sasol. However, Afrimat is 2.71 times more volatile than Sasol Ltd Bee. It trades about 0.04 of its potential returns per unit of risk. Sasol Ltd Bee is currently generating about -0.01 per unit of risk. If you would invest 508,228 in Afrimat on September 12, 2024 and sell it today you would earn a total of 202,272 from holding Afrimat or generate 39.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Afrimat vs. Sasol Ltd Bee
Performance |
| Timeline |
| Afrimat |
| Sasol Ltd Bee |
Afrimat and Sasol Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Afrimat and Sasol
The main advantage of trading using opposite Afrimat and Sasol positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Afrimat position performs unexpectedly, Sasol 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 Sasol will offset losses from the drop in Sasol's long position.| Afrimat vs. Sasol Ltd Bee | Afrimat vs. Centaur Bci Balanced | Afrimat vs. Sabvest Capital | Afrimat vs. Growthpoint Properties |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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