Correlation Between Summit Materials and SASOL
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By analyzing existing cross correlation between Summit Materials and SASOL FING USA, you can compare the effects of market volatilities on Summit Materials and SASOL 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 Summit Materials with a short position of SASOL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Summit Materials and SASOL.
Diversification Opportunities for Summit Materials and SASOL
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Summit and SASOL is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Summit Materials and SASOL FING USA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SASOL FING USA and Summit Materials 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 Summit Materials are associated (or correlated) with SASOL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SASOL FING USA has no effect on the direction of Summit Materials i.e., Summit Materials and SASOL go up and down completely randomly.
Pair Corralation between Summit Materials and SASOL
Considering the 90-day investment horizon Summit Materials is expected to generate 1.76 times more return on investment than SASOL. However, Summit Materials is 1.76 times more volatile than SASOL FING USA. It trades about 0.07 of its potential returns per unit of risk. SASOL FING USA is currently generating about 0.01 per unit of risk. If you would invest 2,994 in Summit Materials on November 9, 2024 and sell it today you would earn a total of 2,255 from holding Summit Materials or generate 75.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 59.03% |
| Values | Daily Returns |
Summit Materials vs. SASOL FING USA
Performance |
| Timeline |
| Summit Materials |
| SASOL FING USA |
Summit Materials and SASOL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Summit Materials and SASOL
The main advantage of trading using opposite Summit Materials and SASOL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Summit Materials position performs unexpectedly, SASOL 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 SASOL will offset losses from the drop in SASOL's long position.| Summit Materials vs. Martin Marietta Materials | Summit Materials vs. Vulcan Materials | Summit Materials vs. United States Lime | Summit Materials vs. James Hardie Industries |
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 CEOs Directory module to screen CEOs from public companies around the world.
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