Correlation Between Sasol and Standard Bank
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By analyzing existing cross correlation between Sasol Ltd Bee and Standard Bank Group, you can compare the effects of market volatilities on Sasol and Standard Bank 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 Standard Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sasol and Standard Bank.
Diversification Opportunities for Sasol and Standard Bank
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sasol and Standard is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Sasol Ltd Bee and Standard Bank Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Standard Bank 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 Standard Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Standard Bank Group has no effect on the direction of Sasol i.e., Sasol and Standard Bank go up and down completely randomly.
Pair Corralation between Sasol and Standard Bank
Assuming the 90 days trading horizon Sasol Ltd Bee is expected to under-perform the Standard Bank. In addition to that, Sasol is 3.47 times more volatile than Standard Bank Group. It trades about -0.31 of its total potential returns per unit of risk. Standard Bank Group is currently generating about -0.3 per unit of volatility. If you would invest 2,482,700 in Standard Bank Group on September 4, 2024 and sell it today you would lose (140,600) from holding Standard Bank Group or give up 5.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Sasol Ltd Bee vs. Standard Bank Group
Performance |
| Timeline |
| Sasol Ltd Bee |
| Standard Bank Group |
Sasol and Standard Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sasol and Standard Bank
The main advantage of trading using opposite Sasol and Standard Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sasol position performs unexpectedly, Standard Bank 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 Standard Bank will offset losses from the drop in Standard Bank's long position.| Sasol vs. Libstar Holdings | Sasol vs. City Lodge Hotels | Sasol vs. African Media Entertainment | Sasol vs. Europa Metals |
| Standard Bank vs. AfroCentric Investment Corp | Standard Bank vs. Allied Electronics | Standard Bank vs. Frontier Transport Holdings | Standard Bank vs. HomeChoice Investments |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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