Correlation Between Harmony Gold and PT Bank
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and PT Bank 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 PT Bank 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 PT Bank Rakyat, you can compare the effects of market volatilities on Harmony Gold and PT Bank 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 PT Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and PT Bank.
Diversification Opportunities for Harmony Gold and PT Bank
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Harmony and BYRA is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and PT Bank Rakyat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Bank Rakyat 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 PT Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Bank Rakyat has no effect on the direction of Harmony Gold i.e., Harmony Gold and PT Bank go up and down completely randomly.
Pair Corralation between Harmony Gold and PT Bank
Assuming the 90 days horizon Harmony Gold Mining is expected to generate 0.35 times more return on investment than PT Bank. However, Harmony Gold Mining is 2.87 times less risky than PT Bank. It trades about -0.13 of its potential returns per unit of risk. PT Bank Rakyat is currently generating about -0.1 per unit of risk. If you would invest 865.00 in Harmony Gold Mining on October 11, 2024 and sell it today you would lose (60.00) from holding Harmony Gold Mining or give up 6.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harmony Gold Mining vs. PT Bank Rakyat
Performance |
| Timeline |
| Harmony Gold Mining |
| PT Bank Rakyat |
Harmony Gold and PT Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harmony Gold and PT Bank
The main advantage of trading using opposite Harmony Gold and PT Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, PT Bank 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 PT Bank will offset losses from the drop in PT Bank's long position.| Harmony Gold vs. Corporate Office Properties | Harmony Gold vs. SILVER BULLET DATA | Harmony Gold vs. alstria office REIT AG | Harmony Gold vs. CITY OFFICE REIT |
| PT Bank vs. Yanzhou Coal Mining | PT Bank vs. Harmony Gold Mining | PT Bank vs. Forsys Metals Corp | PT Bank vs. MINCO 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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