Correlation Between Easy Software and Harmony Gold
Can any of the company-specific risk be diversified away by investing in both Easy Software 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 Easy Software and Harmony Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Easy Software AG and Harmony Gold Mining, you can compare the effects of market volatilities on Easy Software 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 Easy Software with a short position of Harmony Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Easy Software and Harmony Gold.
Diversification Opportunities for Easy Software and Harmony Gold
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Easy and Harmony is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Easy Software AG 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 Easy Software 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 Easy Software AG 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 Easy Software i.e., Easy Software and Harmony Gold go up and down completely randomly.
Pair Corralation between Easy Software and Harmony Gold
Assuming the 90 days trading horizon Easy Software is expected to generate 1.41 times less return on investment than Harmony Gold. But when comparing it to its historical volatility, Easy Software AG is 1.56 times less risky than Harmony Gold. It trades about 0.09 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 775.00 in Harmony Gold Mining on November 3, 2024 and sell it today you would earn a total of 235.00 from holding Harmony Gold Mining or generate 30.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Easy Software AG vs. Harmony Gold Mining
Performance |
| Timeline |
| Easy Software AG |
| Harmony Gold Mining |
Easy Software and Harmony Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Easy Software and Harmony Gold
The main advantage of trading using opposite Easy Software and Harmony Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Easy Software 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.| Easy Software vs. Salesforce | Easy Software vs. SAP SE | Easy Software vs. Uber Technologies | Easy Software vs. PagerDuty |
| Harmony Gold vs. Jacquet Metal Service | Harmony Gold vs. GOLD ROAD RES | Harmony Gold vs. FIREWEED METALS P | Harmony Gold vs. DISTRICT METALS |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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