Correlation Between Ecovyst and Harmony Gold
Can any of the company-specific risk be diversified away by investing in both Ecovyst 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 Ecovyst and Harmony Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ecovyst and Harmony Gold Mining, you can compare the effects of market volatilities on Ecovyst 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 Ecovyst with a short position of Harmony Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ecovyst and Harmony Gold.
Diversification Opportunities for Ecovyst and Harmony Gold
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Ecovyst and Harmony is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Ecovyst 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 Ecovyst 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 Ecovyst 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 Ecovyst i.e., Ecovyst and Harmony Gold go up and down completely randomly.
Pair Corralation between Ecovyst and Harmony Gold
Given the investment horizon of 90 days Ecovyst is expected to generate 0.39 times more return on investment than Harmony Gold. However, Ecovyst is 2.56 times less risky than Harmony Gold. It trades about 0.12 of its potential returns per unit of risk. Harmony Gold Mining is currently generating about -0.22 per unit of risk. If you would invest 762.00 in Ecovyst on September 2, 2024 and sell it today you would earn a total of 33.00 from holding Ecovyst or generate 4.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ecovyst vs. Harmony Gold Mining
Performance |
| Timeline |
| Ecovyst |
| Harmony Gold Mining |
Ecovyst and Harmony Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ecovyst and Harmony Gold
The main advantage of trading using opposite Ecovyst and Harmony Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ecovyst 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.| Ecovyst vs. Orion Engineered Carbons | Ecovyst vs. Cabot | Ecovyst vs. Minerals Technologies | Ecovyst vs. Quaker Chemical |
| 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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