Correlation Between G-III APPAREL and Harmony Gold
Can any of the company-specific risk be diversified away by investing in both G-III APPAREL 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 G-III APPAREL and Harmony Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between G III APPAREL GROUP and Harmony Gold Mining, you can compare the effects of market volatilities on G-III APPAREL 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 G-III APPAREL with a short position of Harmony Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of G-III APPAREL and Harmony Gold.
Diversification Opportunities for G-III APPAREL and Harmony Gold
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between G-III and Harmony is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding G III APPAREL GROUP 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 G-III APPAREL 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 G III APPAREL GROUP 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 G-III APPAREL i.e., G-III APPAREL and Harmony Gold go up and down completely randomly.
Pair Corralation between G-III APPAREL and Harmony Gold
Assuming the 90 days trading horizon G-III APPAREL is expected to generate 1.67 times less return on investment than Harmony Gold. But when comparing it to its historical volatility, G III APPAREL GROUP is 1.15 times less risky than Harmony Gold. It trades about 0.05 of its potential returns per unit of risk. Harmony Gold Mining is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 417.00 in Harmony Gold Mining on August 31, 2024 and sell it today you would earn a total of 428.00 from holding Harmony Gold Mining or generate 102.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
G III APPAREL GROUP vs. Harmony Gold Mining
Performance |
| Timeline |
| G III APPAREL |
| Harmony Gold Mining |
G-III APPAREL and Harmony Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with G-III APPAREL and Harmony Gold
The main advantage of trading using opposite G-III APPAREL and Harmony Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if G-III APPAREL 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.| G-III APPAREL vs. VULCAN MATERIALS | G-III APPAREL vs. EAGLE MATERIALS | G-III APPAREL vs. Southwest Airlines Co | G-III APPAREL vs. JAPAN AIRLINES |
| Harmony Gold vs. ZIJIN MINH UNSPADR20 | Harmony Gold vs. Superior Plus Corp | Harmony Gold vs. NMI Holdings | Harmony Gold vs. Origin Agritech |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |