Correlation Between Harmony Gold and STORE ELECTRONIC
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and STORE ELECTRONIC 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 STORE ELECTRONIC 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 STORE ELECTRONIC, you can compare the effects of market volatilities on Harmony Gold and STORE ELECTRONIC 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 STORE ELECTRONIC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and STORE ELECTRONIC.
Diversification Opportunities for Harmony Gold and STORE ELECTRONIC
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Harmony and STORE is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and STORE ELECTRONIC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STORE ELECTRONIC 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 STORE ELECTRONIC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STORE ELECTRONIC has no effect on the direction of Harmony Gold i.e., Harmony Gold and STORE ELECTRONIC go up and down completely randomly.
Pair Corralation between Harmony Gold and STORE ELECTRONIC
Assuming the 90 days horizon Harmony Gold Mining is expected to generate 1.73 times more return on investment than STORE ELECTRONIC. However, Harmony Gold is 1.73 times more volatile than STORE ELECTRONIC. It trades about 0.04 of its potential returns per unit of risk. STORE ELECTRONIC is currently generating about -0.06 per unit of risk. If you would invest 805.00 in Harmony Gold Mining on September 12, 2024 and sell it today you would earn a total of 50.00 from holding Harmony Gold Mining or generate 6.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harmony Gold Mining vs. STORE ELECTRONIC
Performance |
| Timeline |
| Harmony Gold Mining |
| STORE ELECTRONIC |
Harmony Gold and STORE ELECTRONIC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harmony Gold and STORE ELECTRONIC
The main advantage of trading using opposite Harmony Gold and STORE ELECTRONIC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, STORE ELECTRONIC 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 STORE ELECTRONIC will offset losses from the drop in STORE ELECTRONIC'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 |
| STORE ELECTRONIC vs. Apple Inc | STORE ELECTRONIC vs. Apple Inc | STORE ELECTRONIC vs. Apple Inc | STORE ELECTRONIC vs. Apple Inc |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |