Correlation Between Harmony Gold and KRISPY KREME
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and KRISPY KREME 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 KRISPY KREME 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 KRISPY KREME DL 01, you can compare the effects of market volatilities on Harmony Gold and KRISPY KREME 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 KRISPY KREME. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and KRISPY KREME.
Diversification Opportunities for Harmony Gold and KRISPY KREME
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Harmony and KRISPY is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and KRISPY KREME DL 01 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KRISPY KREME DL 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 KRISPY KREME. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KRISPY KREME DL has no effect on the direction of Harmony Gold i.e., Harmony Gold and KRISPY KREME go up and down completely randomly.
Pair Corralation between Harmony Gold and KRISPY KREME
Assuming the 90 days horizon Harmony Gold Mining is expected to generate 1.13 times more return on investment than KRISPY KREME. However, Harmony Gold is 1.13 times more volatile than KRISPY KREME DL 01. It trades about 0.07 of its potential returns per unit of risk. KRISPY KREME DL 01 is currently generating about -0.01 per unit of risk. If you would invest 407.00 in Harmony Gold Mining on September 4, 2024 and sell it today you would earn a total of 443.00 from holding Harmony Gold Mining or generate 108.85% 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. KRISPY KREME DL 01
Performance |
| Timeline |
| Harmony Gold Mining |
| KRISPY KREME DL |
Harmony Gold and KRISPY KREME Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harmony Gold and KRISPY KREME
The main advantage of trading using opposite Harmony Gold and KRISPY KREME positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, KRISPY KREME 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 KRISPY KREME will offset losses from the drop in KRISPY KREME'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 |
| KRISPY KREME vs. Perseus Mining Limited | KRISPY KREME vs. Jacquet Metal Service | KRISPY KREME vs. LION ONE METALS | KRISPY KREME vs. ETFS Coffee ETC |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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