Correlation Between Home Depot and SASOL

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Home Depot and SASOL 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 Home Depot and SASOL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Home Depot and SASOL 4375 18 SEP 26, you can compare the effects of market volatilities on Home Depot 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 Home Depot with a short position of SASOL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Home Depot and SASOL.

Diversification Opportunities for Home Depot and SASOL

0.34
  Correlation Coefficient

Weak diversification

The 3 months correlation between Home and SASOL is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Home Depot and SASOL 4375 18 SEP 26 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SASOL 4375 18 and Home Depot 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 Home Depot 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 4375 18 has no effect on the direction of Home Depot i.e., Home Depot and SASOL go up and down completely randomly.

Pair Corralation between Home Depot and SASOL

Allowing for the 90-day total investment horizon Home Depot is expected to generate 5.02 times more return on investment than SASOL. However, Home Depot is 5.02 times more volatile than SASOL 4375 18 SEP 26. It trades about 0.29 of its potential returns per unit of risk. SASOL 4375 18 SEP 26 is currently generating about -0.22 per unit of risk. If you would invest  39,350  in Home Depot on September 3, 2024 and sell it today you would earn a total of  3,563  from holding Home Depot or generate 9.05% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy60.0%
ValuesDaily Returns

Home Depot  vs.  SASOL 4375 18 SEP 26

 Performance 
       Timeline  
Home Depot 

Risk-Adjusted Performance

18 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Home Depot are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile fundamental indicators, Home Depot exhibited solid returns over the last few months and may actually be approaching a breakup point.
SASOL 4375 18 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days SASOL 4375 18 SEP 26 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, SASOL is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Home Depot and SASOL Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Home Depot and SASOL

The main advantage of trading using opposite Home Depot and SASOL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Home Depot 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.
Home Depot vs. Partner Communications
Home Depot vs. Merck Company
Home Depot vs. Western Midstream Partners
Home Depot vs. Edgewise Therapeutics
The idea behind Home Depot and SASOL 4375 18 SEP 26 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.
SASOL vs. BorgWarner
SASOL vs. Amkor Technology
SASOL vs. Lipocine
SASOL vs. American Axle Manufacturing
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..

Other Complementary Tools

Global Markets Map
Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes
Portfolio Holdings
Check your current holdings and cash postion to detemine if your portfolio needs rebalancing
Stocks Directory
Find actively traded stocks across global markets
Latest Portfolios
Quick portfolio dashboard that showcases your latest portfolios
Equity Valuation
Check real value of public entities based on technical and fundamental data


 
Macroaxis helps investors of all levels and skills to maximize the upside of all their holdings and minimize the risk associated with market volatility, economic swings, and company-specific events. View terms and conditions
 
Feedback Blog
Made with optimal in San Francisco
2024 Macroaxis LLC
COMMON DESTINATIONS
MAIN CATEGORIES
COMPANY