Correlation Between TD Holdings and Harmony Gold
Can any of the company-specific risk be diversified away by investing in both TD Holdings 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 TD Holdings and Harmony Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TD Holdings and Harmony Gold Mining, you can compare the effects of market volatilities on TD Holdings 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 TD Holdings with a short position of Harmony Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of TD Holdings and Harmony Gold.
Diversification Opportunities for TD Holdings and Harmony Gold
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between GLG and Harmony is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding TD Holdings 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 TD Holdings 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 TD Holdings 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 TD Holdings i.e., TD Holdings and Harmony Gold go up and down completely randomly.
Pair Corralation between TD Holdings and Harmony Gold
Considering the 90-day investment horizon TD Holdings is expected to under-perform the Harmony Gold. In addition to that, TD Holdings is 1.08 times more volatile than Harmony Gold Mining. It trades about -0.18 of its total potential returns per unit of risk. Harmony Gold Mining is currently generating about 0.09 per unit of volatility. If you would invest 322.00 in Harmony Gold Mining on November 2, 2024 and sell it today you would earn a total of 810.50 from holding Harmony Gold Mining or generate 251.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 22.67% |
| Values | Daily Returns |
TD Holdings vs. Harmony Gold Mining
Performance |
| Timeline |
| TD Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Harmony Gold Mining |
TD Holdings and Harmony Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TD Holdings and Harmony Gold
The main advantage of trading using opposite TD Holdings and Harmony Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TD Holdings 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.| TD Holdings vs. Vizsla Resources Corp | TD Holdings vs. Western Copper and | TD Holdings vs. Americas Silver Corp | TD Holdings vs. EMX Royalty Corp |
| Harmony Gold vs. AngloGold Ashanti plc | Harmony Gold vs. Eldorado Gold Corp | Harmony Gold vs. Kinross Gold | Harmony Gold vs. Pan American Silver |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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