Correlation Between Harmony Gold and Mesa Air
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and Mesa Air 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 Mesa Air 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 Mesa Air Group, you can compare the effects of market volatilities on Harmony Gold and Mesa Air 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 Mesa Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and Mesa Air.
Diversification Opportunities for Harmony Gold and Mesa Air
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Harmony and Mesa is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and Mesa Air Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mesa Air Group 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 Mesa Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mesa Air Group has no effect on the direction of Harmony Gold i.e., Harmony Gold and Mesa Air go up and down completely randomly.
Pair Corralation between Harmony Gold and Mesa Air
Assuming the 90 days horizon Harmony Gold Mining is expected to under-perform the Mesa Air. In addition to that, Harmony Gold is 1.08 times more volatile than Mesa Air Group. It trades about -0.21 of its total potential returns per unit of risk. Mesa Air Group is currently generating about 0.25 per unit of volatility. If you would invest 91.00 in Mesa Air Group on August 31, 2024 and sell it today you would earn a total of 21.00 from holding Mesa Air Group or generate 23.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harmony Gold Mining vs. Mesa Air Group
Performance |
| Timeline |
| Harmony Gold Mining |
| Mesa Air Group |
Harmony Gold and Mesa Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harmony Gold and Mesa Air
The main advantage of trading using opposite Harmony Gold and Mesa Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, Mesa Air 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 Mesa Air will offset losses from the drop in Mesa Air's long position.| Harmony Gold vs. Aurion Resources | Harmony Gold vs. Rio2 Limited | Harmony Gold vs. Palamina Corp | Harmony Gold vs. BTU Metals Corp |
| Mesa Air vs. Allegiant Travel | Mesa Air vs. Sun Country Airlines | Mesa Air vs. Frontier Group Holdings | Mesa Air vs. Azul SA |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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