Correlation Between Sasol and MTN
Specify exactly 2 symbols:
By analyzing existing cross correlation between Sasol Ltd Bee and MTN Group, you can compare the effects of market volatilities on Sasol and MTN 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 MTN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sasol and MTN.
Diversification Opportunities for Sasol and MTN
Very weak diversification
The 3 months correlation between Sasol and MTN is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Sasol Ltd Bee and MTN Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MTN Group 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 MTN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MTN Group has no effect on the direction of Sasol i.e., Sasol and MTN go up and down completely randomly.
Pair Corralation between Sasol and MTN
Assuming the 90 days trading horizon Sasol Ltd Bee is expected to under-perform the MTN. In addition to that, Sasol is 2.42 times more volatile than MTN Group. It trades about -0.35 of its total potential returns per unit of risk. MTN Group is currently generating about -0.3 per unit of volatility. If you would invest 891,900 in MTN Group on August 24, 2024 and sell it today you would lose (73,900) from holding MTN Group or give up 8.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Sasol Ltd Bee vs. MTN Group
Performance |
| Timeline |
| Sasol Ltd Bee |
| MTN Group |
Sasol and MTN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sasol and MTN
The main advantage of trading using opposite Sasol and MTN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sasol position performs unexpectedly, MTN 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 MTN will offset losses from the drop in MTN's long position.The idea behind Sasol Ltd Bee and MTN Group 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.| MTN vs. Reinet Investments SCA | MTN vs. Hosken Consolidated Investments | MTN vs. Standard Bank Group | MTN vs. Brimstone Investment |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |