Correlation Between Harmony Gold and Brockhaus Capital

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and Brockhaus Capital 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 Brockhaus Capital 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 Brockhaus Capital Management, you can compare the effects of market volatilities on Harmony Gold and Brockhaus Capital 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 Brockhaus Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and Brockhaus Capital.

Diversification Opportunities for Harmony Gold and Brockhaus Capital

-0.11
  Correlation Coefficient

Good diversification

The 3 months correlation between Harmony and Brockhaus is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and Brockhaus Capital Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brockhaus Capital 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 Brockhaus Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brockhaus Capital has no effect on the direction of Harmony Gold i.e., Harmony Gold and Brockhaus Capital go up and down completely randomly.

Pair Corralation between Harmony Gold and Brockhaus Capital

Assuming the 90 days horizon Harmony Gold Mining is expected to generate 1.13 times more return on investment than Brockhaus Capital. However, Harmony Gold is 1.13 times more volatile than Brockhaus Capital Management. It trades about 0.05 of its potential returns per unit of risk. Brockhaus Capital Management is currently generating about -0.02 per unit of risk. If you would invest  810.00  in Harmony Gold Mining on August 28, 2024 and sell it today you would earn a total of  120.00  from holding Harmony Gold Mining or generate 14.81% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Harmony Gold Mining  vs.  Brockhaus Capital Management

 Performance 
       Timeline  
Harmony Gold Mining 

Risk-Adjusted Performance

3 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in Harmony Gold Mining are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Harmony Gold may actually be approaching a critical reversion point that can send shares even higher in December 2024.
Brockhaus Capital 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Brockhaus Capital Management has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's technical indicators remain nearly stable which may send shares a bit higher in December 2024. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Harmony Gold and Brockhaus Capital Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Harmony Gold and Brockhaus Capital

The main advantage of trading using opposite Harmony Gold and Brockhaus Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, Brockhaus Capital 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 Brockhaus Capital will offset losses from the drop in Brockhaus Capital's long position.
The idea behind Harmony Gold Mining and Brockhaus Capital Management pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..

Other Complementary Tools

FinTech Suite
Use AI to screen and filter profitable investment opportunities
Bollinger Bands
Use Bollinger Bands indicator to analyze target price for a given investing horizon
Economic Indicators
Top statistical indicators that provide insights into how an economy is performing
Instant Ratings
Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance
Idea Breakdown
Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes