Correlation Between Sociedad Comercial and Harmony Gold
Can any of the company-specific risk be diversified away by investing in both Sociedad Comercial 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 Sociedad Comercial and Harmony Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sociedad Comercial del and Harmony Gold Mining, you can compare the effects of market volatilities on Sociedad Comercial 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 Sociedad Comercial with a short position of Harmony Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sociedad Comercial and Harmony Gold.
Diversification Opportunities for Sociedad Comercial and Harmony Gold
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sociedad and Harmony is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Sociedad Comercial 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 Sociedad Comercial 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 Sociedad Comercial 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 Sociedad Comercial i.e., Sociedad Comercial and Harmony Gold go up and down completely randomly.
Pair Corralation between Sociedad Comercial and Harmony Gold
Assuming the 90 days trading horizon Sociedad Comercial del is expected to under-perform the Harmony Gold. In addition to that, Sociedad Comercial is 1.6 times more volatile than Harmony Gold Mining. It trades about -0.11 of its total potential returns per unit of risk. Harmony Gold Mining is currently generating about 0.59 per unit of volatility. If you would invest 987,000 in Harmony Gold Mining on November 3, 2024 and sell it today you would earn a total of 335,500 from holding Harmony Gold Mining or generate 33.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sociedad Comercial del vs. Harmony Gold Mining
Performance |
| Timeline |
| Sociedad Comercial del |
| Harmony Gold Mining |
Sociedad Comercial and Harmony Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sociedad Comercial and Harmony Gold
The main advantage of trading using opposite Sociedad Comercial and Harmony Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sociedad Comercial 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.| Sociedad Comercial vs. Harmony Gold Mining | Sociedad Comercial vs. Agrometal SAI | Sociedad Comercial vs. United States Steel | Sociedad Comercial vs. Transportadora de Gas |
| Harmony Gold vs. Agrometal SAI | Harmony Gold vs. Compania de Transporte | Harmony Gold vs. Transportadora de Gas | Harmony Gold vs. Telecom Argentina |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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