Correlation Between Grupo Aeroportuario and Harmony Gold
Can any of the company-specific risk be diversified away by investing in both Grupo Aeroportuario and Harmony Gold 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 Grupo Aeroportuario and Harmony Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Aeroportuario del and Harmony Gold Mining, you can compare the effects of market volatilities on Grupo Aeroportuario and Harmony Gold 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 Grupo Aeroportuario with a short position of Harmony Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Aeroportuario and Harmony Gold.
Diversification Opportunities for Grupo Aeroportuario and Harmony Gold
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Grupo and Harmony is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Aeroportuario del and Harmony Gold Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harmony Gold Mining and Grupo Aeroportuario 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 Grupo Aeroportuario del are associated (or correlated) with Harmony Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harmony Gold Mining has no effect on the direction of Grupo Aeroportuario i.e., Grupo Aeroportuario and Harmony Gold go up and down completely randomly.
Pair Corralation between Grupo Aeroportuario and Harmony Gold
Considering the 90-day investment horizon Grupo Aeroportuario is expected to generate 3.61 times less return on investment than Harmony Gold. But when comparing it to its historical volatility, Grupo Aeroportuario del is 1.47 times less risky than Harmony Gold. It trades about 0.03 of its potential returns per unit of risk. Harmony Gold Mining is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 636.00 in Harmony Gold Mining on September 2, 2024 and sell it today you would earn a total of 314.00 from holding Harmony Gold Mining or generate 49.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 68.55% |
| Values | Daily Returns |
Grupo Aeroportuario del vs. Harmony Gold Mining
Performance |
| Timeline |
| Grupo Aeroportuario del |
| Harmony Gold Mining |
Grupo Aeroportuario and Harmony Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Aeroportuario and Harmony Gold
The main advantage of trading using opposite Grupo Aeroportuario and Harmony Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Aeroportuario position performs unexpectedly, Harmony Gold 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 Harmony Gold will offset losses from the drop in Harmony Gold's long position.| Grupo Aeroportuario vs. Grupo Aeroportuario del | Grupo Aeroportuario vs. AerSale Corp | Grupo Aeroportuario vs. Flughafen Zrich AG | Grupo Aeroportuario vs. Grupo Aeroportuario del |
| Harmony Gold vs. Aurion Resources | Harmony Gold vs. Rio2 Limited | Harmony Gold vs. Palamina Corp | Harmony Gold vs. Grande Portage Resources |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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