Correlation Between Harmony Gold and Office Properties
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and Office Properties 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 Office Properties 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 Office Properties Income, you can compare the effects of market volatilities on Harmony Gold and Office Properties 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 Office Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and Office Properties.
Diversification Opportunities for Harmony Gold and Office Properties
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Harmony and Office is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and Office Properties Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Office Properties Income 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 Office Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Office Properties Income has no effect on the direction of Harmony Gold i.e., Harmony Gold and Office Properties go up and down completely randomly.
Pair Corralation between Harmony Gold and Office Properties
Assuming the 90 days horizon Harmony Gold Mining is expected to generate 0.6 times more return on investment than Office Properties. However, Harmony Gold Mining is 1.68 times less risky than Office Properties. It trades about 0.07 of its potential returns per unit of risk. Office Properties Income is currently generating about -0.04 per unit of risk. If you would invest 417.00 in Harmony Gold Mining on August 31, 2024 and sell it today you would earn a total of 428.00 from holding Harmony Gold Mining or generate 102.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.74% |
| Values | Daily Returns |
Harmony Gold Mining vs. Office Properties Income
Performance |
| Timeline |
| Harmony Gold Mining |
| Office Properties Income |
Harmony Gold and Office Properties Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harmony Gold and Office Properties
The main advantage of trading using opposite Harmony Gold and Office Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, Office Properties 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 Office Properties will offset losses from the drop in Office Properties' long position.| Harmony Gold vs. ZIJIN MINH UNSPADR20 | Harmony Gold vs. Superior Plus Corp | Harmony Gold vs. NMI Holdings | Harmony Gold vs. Origin Agritech |
| Office Properties vs. Entravision Communications | Office Properties vs. International Consolidated Airlines | Office Properties vs. COMPUTERSHARE | Office Properties vs. Ribbon Communications |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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