Correlation Between Harmony Gold and FUTURE GAMING
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and FUTURE GAMING 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 Harmony Gold and FUTURE GAMING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Harmony Gold Mining and FUTURE GAMING GRP, you can compare the effects of market volatilities on Harmony Gold and FUTURE GAMING 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 Harmony Gold with a short position of FUTURE GAMING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and FUTURE GAMING.
Diversification Opportunities for Harmony Gold and FUTURE GAMING
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Harmony and FUTURE is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and FUTURE GAMING GRP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FUTURE GAMING GRP and Harmony Gold 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 Harmony Gold Mining are associated (or correlated) with FUTURE GAMING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FUTURE GAMING GRP has no effect on the direction of Harmony Gold i.e., Harmony Gold and FUTURE GAMING go up and down completely randomly.
Pair Corralation between Harmony Gold and FUTURE GAMING
Assuming the 90 days horizon Harmony Gold is expected to generate 1.06 times less return on investment than FUTURE GAMING. But when comparing it to its historical volatility, Harmony Gold Mining is 1.98 times less risky than FUTURE GAMING. It trades about 0.07 of its potential returns per unit of risk. FUTURE GAMING GRP is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 38.00 in FUTURE GAMING GRP on September 3, 2024 and sell it today you would earn a total of 13.00 from holding FUTURE GAMING GRP or generate 34.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harmony Gold Mining vs. FUTURE GAMING GRP
Performance |
| Timeline |
| Harmony Gold Mining |
| FUTURE GAMING GRP |
Harmony Gold and FUTURE GAMING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harmony Gold and FUTURE GAMING
The main advantage of trading using opposite Harmony Gold and FUTURE GAMING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, FUTURE GAMING 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 FUTURE GAMING will offset losses from the drop in FUTURE GAMING's long position.| Harmony Gold vs. ZIJIN MINH UNSPADR20 | Harmony Gold vs. Barrick Gold | Harmony Gold vs. Superior Plus Corp | Harmony Gold vs. NMI Holdings |
| FUTURE GAMING vs. Playtech plc | FUTURE GAMING vs. ARISTOCRAT LEISURE | FUTURE GAMING vs. RYU Apparel | FUTURE GAMING vs. COMMERCIAL VEHICLE |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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