Correlation Between Harmony Gold and CHINA SOUTHN
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and CHINA SOUTHN 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 CHINA SOUTHN 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 CHINA SOUTHN AIR H , you can compare the effects of market volatilities on Harmony Gold and CHINA SOUTHN 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 CHINA SOUTHN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and CHINA SOUTHN.
Diversification Opportunities for Harmony Gold and CHINA SOUTHN
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Harmony and CHINA is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and CHINA SOUTHN AIR H in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHINA SOUTHN AIR 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 CHINA SOUTHN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHINA SOUTHN AIR has no effect on the direction of Harmony Gold i.e., Harmony Gold and CHINA SOUTHN go up and down completely randomly.
Pair Corralation between Harmony Gold and CHINA SOUTHN
Assuming the 90 days horizon Harmony Gold Mining is expected to generate 0.82 times more return on investment than CHINA SOUTHN. However, Harmony Gold Mining is 1.22 times less risky than CHINA SOUTHN. It trades about 0.13 of its potential returns per unit of risk. CHINA SOUTHN AIR H is currently generating about 0.01 per unit of risk. If you would invest 835.00 in Harmony Gold Mining on October 17, 2024 and sell it today you would earn a total of 45.00 from holding Harmony Gold Mining or generate 5.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
Harmony Gold Mining vs. CHINA SOUTHN AIR H
Performance |
| Timeline |
| Harmony Gold Mining |
| CHINA SOUTHN AIR |
Harmony Gold and CHINA SOUTHN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harmony Gold and CHINA SOUTHN
The main advantage of trading using opposite Harmony Gold and CHINA SOUTHN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, CHINA SOUTHN 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 CHINA SOUTHN will offset losses from the drop in CHINA SOUTHN's long position.| Harmony Gold vs. CONTAGIOUS GAMING INC | Harmony Gold vs. Boyd Gaming | Harmony Gold vs. CRISPR Therapeutics AG | Harmony Gold vs. TROPHY GAMES DEV |
| CHINA SOUTHN vs. Vulcan Materials | CHINA SOUTHN vs. Summit Materials | CHINA SOUTHN vs. ARROW ELECTRONICS | CHINA SOUTHN vs. Arrow Electronics |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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