Correlation Between Sasol and Rex Trueform
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By analyzing existing cross correlation between Sasol Ltd Bee and Rex Trueform Group, you can compare the effects of market volatilities on Sasol and Rex Trueform 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 Rex Trueform. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sasol and Rex Trueform.
Diversification Opportunities for Sasol and Rex Trueform
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Sasol and Rex is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Sasol Ltd Bee and Rex Trueform Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rex Trueform 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 Rex Trueform. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rex Trueform Group has no effect on the direction of Sasol i.e., Sasol and Rex Trueform go up and down completely randomly.
Pair Corralation between Sasol and Rex Trueform
Assuming the 90 days trading horizon Sasol Ltd Bee is expected to under-perform the Rex Trueform. In addition to that, Sasol is 2.18 times more volatile than Rex Trueform Group. It trades about -0.02 of its total potential returns per unit of risk. Rex Trueform Group is currently generating about -0.03 per unit of volatility. If you would invest 150,000 in Rex Trueform Group on September 4, 2024 and sell it today you would lose (32,800) from holding Rex Trueform Group or give up 21.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sasol Ltd Bee vs. Rex Trueform Group
Performance |
| Timeline |
| Sasol Ltd Bee |
| Rex Trueform Group |
Sasol and Rex Trueform Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sasol and Rex Trueform
The main advantage of trading using opposite Sasol and Rex Trueform positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sasol position performs unexpectedly, Rex Trueform 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 Rex Trueform will offset losses from the drop in Rex Trueform's long position.| Sasol vs. Libstar Holdings | Sasol vs. City Lodge Hotels | Sasol vs. African Media Entertainment | Sasol vs. Europa Metals |
| Rex Trueform vs. Ascendis Health | Rex Trueform vs. Hosken Consolidated Investments | Rex Trueform vs. Astral Foods | Rex Trueform vs. RCL Foods |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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