Correlation Between Harmony Gold and Hunter Creek
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and Hunter Creek 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 Hunter Creek 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 Hunter Creek Mining, you can compare the effects of market volatilities on Harmony Gold and Hunter Creek 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 Hunter Creek. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and Hunter Creek.
Diversification Opportunities for Harmony Gold and Hunter Creek
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Harmony and Hunter is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and Hunter Creek Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hunter Creek Mining 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 Hunter Creek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hunter Creek Mining has no effect on the direction of Harmony Gold i.e., Harmony Gold and Hunter Creek go up and down completely randomly.
Pair Corralation between Harmony Gold and Hunter Creek
Assuming the 90 days horizon Harmony Gold is expected to generate 1.7 times less return on investment than Hunter Creek. But when comparing it to its historical volatility, Harmony Gold Mining is 4.66 times less risky than Hunter Creek. It trades about 0.09 of its potential returns per unit of risk. Hunter Creek Mining is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 20.00 in Hunter Creek Mining on November 5, 2024 and sell it today you would lose (10.20) from holding Hunter Creek Mining or give up 51.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 64.86% |
| Values | Daily Returns |
Harmony Gold Mining vs. Hunter Creek Mining
Performance |
| Timeline |
| Harmony Gold Mining |
| Hunter Creek Mining |
Harmony Gold and Hunter Creek Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harmony Gold and Hunter Creek
The main advantage of trading using opposite Harmony Gold and Hunter Creek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, Hunter Creek 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 Hunter Creek will offset losses from the drop in Hunter Creek's long position.| Harmony Gold vs. Westrock Coffee | Harmony Gold vs. Parker Hannifin | Harmony Gold vs. Wingstop | Harmony Gold vs. Dine Brands Global |
| Hunter Creek vs. Playtika Holding Corp | Hunter Creek vs. Bilibili | Hunter Creek vs. Jabil Circuit | Hunter Creek vs. Penn National Gaming |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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