Correlation Between Venator Materials and Sasol
Can any of the company-specific risk be diversified away by investing in both Venator Materials and Sasol at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Venator Materials and Sasol into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Venator Materials PLC and Sasol, you can compare the effects of market volatilities on Venator 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 Venator Materials with a short position of Sasol. Check out your portfolio center. Please also check ongoing floating volatility patterns of Venator Materials and Sasol.
Diversification Opportunities for Venator Materials and Sasol
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Venator and Sasol is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Venator Materials PLC and Sasol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sasol and Venator 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 Venator Materials PLC 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 has no effect on the direction of Venator Materials i.e., Venator Materials and Sasol go up and down completely randomly.
Pair Corralation between Venator Materials and Sasol
If you would invest 462.00 in Sasol on November 28, 2024 and sell it today you would earn a total of 1.00 from holding Sasol or generate 0.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Venator Materials PLC vs. Sasol
Performance |
| Timeline |
| Venator Materials PLC |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| Sasol |
Venator Materials and Sasol Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Venator Materials and Sasol
The main advantage of trading using opposite Venator Materials and Sasol positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Venator 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.| Venator Materials vs. Orion Engineered Carbons | Venator Materials vs. Select Energy Services | Venator Materials vs. Perimeter Solutions SA | Venator Materials vs. FutureFuel Corp |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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