Correlation Between SASOL and Dow Jones
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By analyzing existing cross correlation between SASOL FING USA and Dow Jones Industrial, you can compare the effects of market volatilities on SASOL and Dow Jones 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 Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of SASOL and Dow Jones.
Diversification Opportunities for SASOL and Dow Jones
Good diversification
The 3 months correlation between SASOL and Dow is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding SASOL FING USA and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial 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 FING USA are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of SASOL i.e., SASOL and Dow Jones go up and down completely randomly.
Pair Corralation between SASOL and Dow Jones
Assuming the 90 days trading horizon SASOL FING USA is expected to under-perform the Dow Jones. In addition to that, SASOL is 1.73 times more volatile than Dow Jones Industrial. It trades about -0.13 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.27 per unit of volatility. If you would invest 4,238,757 in Dow Jones Industrial on August 29, 2024 and sell it today you would earn a total of 247,274 from holding Dow Jones Industrial or generate 5.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
SASOL FING USA vs. Dow Jones Industrial
Performance |
| Timeline |
SASOL and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
SASOL FING USA
Pair trading matchups for SASOL
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with SASOL and Dow Jones
The main advantage of trading using opposite SASOL and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SASOL position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| SASOL vs. Coty Inc | SASOL vs. JD Sports Fashion | SASOL vs. Lindblad Expeditions Holdings | SASOL vs. Canlan Ice Sports |
| Dow Jones vs. CECO Environmental Corp | Dow Jones vs. Western Acquisition Ventures | Dow Jones vs. Tyson Foods | Dow Jones vs. Inflection Point Acquisition |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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