Correlation Between Harmony Gold and Autohome ADR
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and Autohome ADR 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 Autohome ADR 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 Autohome ADR, you can compare the effects of market volatilities on Harmony Gold and Autohome ADR 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 Autohome ADR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and Autohome ADR.
Diversification Opportunities for Harmony Gold and Autohome ADR
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Harmony and Autohome is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and Autohome ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autohome ADR 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 Autohome ADR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autohome ADR has no effect on the direction of Harmony Gold i.e., Harmony Gold and Autohome ADR go up and down completely randomly.
Pair Corralation between Harmony Gold and Autohome ADR
Assuming the 90 days horizon Harmony Gold Mining is expected to under-perform the Autohome ADR. In addition to that, Harmony Gold is 1.63 times more volatile than Autohome ADR. It trades about -0.19 of its total potential returns per unit of risk. Autohome ADR is currently generating about 0.01 per unit of volatility. If you would invest 2,600 in Autohome ADR on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Autohome ADR or generate 0.0% 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. Autohome ADR
Performance |
| Timeline |
| Harmony Gold Mining |
| Autohome ADR |
Harmony Gold and Autohome ADR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harmony Gold and Autohome ADR
The main advantage of trading using opposite Harmony Gold and Autohome ADR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, Autohome ADR 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 Autohome ADR will offset losses from the drop in Autohome ADR's long position.| Harmony Gold vs. Franco Nevada | Harmony Gold vs. Wheaton Precious Metals | Harmony Gold vs. Superior Plus Corp | Harmony Gold vs. NMI Holdings |
| Autohome ADR vs. SCIENCE IN SPORT | Autohome ADR vs. Air Transport Services | Autohome ADR vs. AVITA Medical | Autohome ADR vs. Fukuyama Transporting Co |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |