Correlation Between Harmony Gold and CHIBA BANK
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and CHIBA 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 CHIBA 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 CHIBA BANK, you can compare the effects of market volatilities on Harmony Gold and CHIBA 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 CHIBA BANK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and CHIBA BANK.
Diversification Opportunities for Harmony Gold and CHIBA BANK
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Harmony and CHIBA is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and CHIBA BANK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHIBA BANK 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 CHIBA BANK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHIBA BANK has no effect on the direction of Harmony Gold i.e., Harmony Gold and CHIBA BANK go up and down completely randomly.
Pair Corralation between Harmony Gold and CHIBA BANK
Assuming the 90 days horizon Harmony Gold Mining is expected to under-perform the CHIBA BANK. In addition to that, Harmony Gold is 1.52 times more volatile than CHIBA BANK. It trades about -0.05 of its total potential returns per unit of risk. CHIBA BANK is currently generating about 0.1 per unit of volatility. If you would invest 755.00 in CHIBA BANK on September 12, 2024 and sell it today you would earn a total of 30.00 from holding CHIBA BANK or generate 3.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harmony Gold Mining vs. CHIBA BANK
Performance |
| Timeline |
| Harmony Gold Mining |
| CHIBA BANK |
Harmony Gold and CHIBA BANK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harmony Gold and CHIBA BANK
The main advantage of trading using opposite Harmony Gold and CHIBA BANK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, CHIBA 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 CHIBA BANK will offset losses from the drop in CHIBA BANK's long position.| Harmony Gold vs. Franco Nevada | Harmony Gold vs. Superior Plus Corp | Harmony Gold vs. SIVERS SEMICONDUCTORS AB | Harmony Gold vs. Norsk Hydro ASA |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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