Correlation Between Sasol and Anglo American
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By analyzing existing cross correlation between Sasol Ltd Bee and Anglo American PLC, you can compare the effects of market volatilities on Sasol and Anglo American 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 Sasol with a short position of Anglo American. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sasol and Anglo American.
Diversification Opportunities for Sasol and Anglo American
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sasol and Anglo is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Sasol Ltd Bee and Anglo American PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anglo American PLC and Sasol 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 Sasol Ltd Bee are associated (or correlated) with Anglo American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anglo American PLC has no effect on the direction of Sasol i.e., Sasol and Anglo American go up and down completely randomly.
Pair Corralation between Sasol and Anglo American
Assuming the 90 days trading horizon Sasol Ltd Bee is expected to under-perform the Anglo American. In addition to that, Sasol is 1.77 times more volatile than Anglo American PLC. It trades about -0.01 of its total potential returns per unit of risk. Anglo American PLC is currently generating about 0.0 per unit of volatility. If you would invest 6,364,934 in Anglo American PLC on September 12, 2024 and sell it today you would lose (644,534) from holding Anglo American PLC or give up 10.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sasol Ltd Bee vs. Anglo American PLC
Performance |
| Timeline |
| Sasol Ltd Bee |
| Anglo American PLC |
Sasol and Anglo American Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sasol and Anglo American
The main advantage of trading using opposite Sasol and Anglo American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sasol position performs unexpectedly, Anglo American 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 Anglo American will offset losses from the drop in Anglo American's long position.The idea behind Sasol Ltd Bee and Anglo American PLC 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.| Anglo American vs. African Rainbow Minerals | Anglo American vs. Jubilee Platinum | Anglo American vs. Europa Metals | Anglo American vs. Sasol Ltd Bee |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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