Correlation Between Sasol and SLM Corp
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By analyzing existing cross correlation between Sasol Ltd Bee and Sanlam, you can compare the effects of market volatilities on Sasol and SLM Corp 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 SLM Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sasol and SLM Corp.
Diversification Opportunities for Sasol and SLM Corp
Very good diversification
The 3 months correlation between Sasol and SLM is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Sasol Ltd Bee and Sanlam in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SLM Corp 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 SLM Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SLM Corp has no effect on the direction of Sasol i.e., Sasol and SLM Corp go up and down completely randomly.
Pair Corralation between Sasol and SLM Corp
Assuming the 90 days trading horizon Sasol Ltd Bee is expected to under-perform the SLM Corp. In addition to that, Sasol is 2.89 times more volatile than Sanlam. It trades about -0.01 of its total potential returns per unit of risk. Sanlam is currently generating about 0.11 per unit of volatility. If you would invest 420,381 in Sanlam on September 2, 2024 and sell it today you would earn a total of 460,619 from holding Sanlam or generate 109.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Sasol Ltd Bee vs. Sanlam
Performance |
| Timeline |
| Sasol Ltd Bee |
| SLM Corp |
Sasol and SLM Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sasol and SLM Corp
The main advantage of trading using opposite Sasol and SLM Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sasol position performs unexpectedly, SLM Corp 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 SLM Corp will offset losses from the drop in SLM Corp's long position.The idea behind Sasol Ltd Bee and Sanlam 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.| SLM Corp vs. Sasol Ltd Bee | SLM Corp vs. Centaur Bci Balanced | SLM Corp vs. Sabvest Capital | SLM Corp vs. Growthpoint Properties |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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