Correlation Between ChampionX and Harmony Gold
Can any of the company-specific risk be diversified away by investing in both ChampionX 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 ChampionX and Harmony Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ChampionX and Harmony Gold Mining, you can compare the effects of market volatilities on ChampionX 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 ChampionX with a short position of Harmony Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of ChampionX and Harmony Gold.
Diversification Opportunities for ChampionX and Harmony Gold
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between ChampionX and Harmony is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding ChampionX 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 ChampionX 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 ChampionX 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 ChampionX i.e., ChampionX and Harmony Gold go up and down completely randomly.
Pair Corralation between ChampionX and Harmony Gold
Considering the 90-day investment horizon ChampionX is expected to generate 41.67 times less return on investment than Harmony Gold. But when comparing it to its historical volatility, ChampionX is 4.14 times less risky than Harmony Gold. It trades about 0.02 of its potential returns per unit of risk. Harmony Gold Mining is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 424.00 in Harmony Gold Mining on November 30, 2024 and sell it today you would earn a total of 776.00 from holding Harmony Gold Mining or generate 183.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 15.38% |
| Values | Daily Returns |
ChampionX vs. Harmony Gold Mining
Performance |
| Timeline |
| ChampionX |
| Harmony Gold Mining |
ChampionX and Harmony Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ChampionX and Harmony Gold
The main advantage of trading using opposite ChampionX and Harmony Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ChampionX 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.| ChampionX vs. Expro Group Holdings | ChampionX vs. Ranger Energy Services | ChampionX vs. Cactus Inc | ChampionX vs. MRC Global |
| Harmony Gold vs. Kilroy Realty Corp | Harmony Gold vs. Unilever PLC ADR | Harmony Gold vs. World Houseware Limited | Harmony Gold vs. Church Dwight |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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