Correlation Between Harmony Gold and Chemours
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and Chemours 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 Chemours 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 Chemours Co, you can compare the effects of market volatilities on Harmony Gold and Chemours 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 Chemours. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and Chemours.
Diversification Opportunities for Harmony Gold and Chemours
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Harmony and Chemours is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and Chemours Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chemours 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 Chemours. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chemours has no effect on the direction of Harmony Gold i.e., Harmony Gold and Chemours go up and down completely randomly.
Pair Corralation between Harmony Gold and Chemours
Assuming the 90 days horizon Harmony Gold Mining is expected to under-perform the Chemours. In addition to that, Harmony Gold is 1.08 times more volatile than Chemours Co. It trades about -0.21 of its total potential returns per unit of risk. Chemours Co is currently generating about 0.21 per unit of volatility. If you would invest 1,808 in Chemours Co on August 26, 2024 and sell it today you would earn a total of 345.00 from holding Chemours Co or generate 19.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harmony Gold Mining vs. Chemours Co
Performance |
| Timeline |
| Harmony Gold Mining |
| Chemours |
Harmony Gold and Chemours Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harmony Gold and Chemours
The main advantage of trading using opposite Harmony Gold and Chemours positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, Chemours 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 Chemours will offset losses from the drop in Chemours' long position.| Harmony Gold vs. Zoom Video Communications | Harmony Gold vs. Summit Environmental | Harmony Gold vs. Sanyo Special Steel | Harmony Gold vs. United States Steel |
| Chemours vs. Olin Corporation | Chemours vs. Cabot | Chemours vs. Kronos Worldwide | Chemours vs. LyondellBasell Industries NV |
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 Stocks Directory module to find actively traded stocks across global markets.
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