Correlation Between Harmony Gold and Dycasa SA
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and Dycasa SA 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 Dycasa SA 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 Dycasa SA, you can compare the effects of market volatilities on Harmony Gold and Dycasa SA 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 Dycasa SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and Dycasa SA.
Diversification Opportunities for Harmony Gold and Dycasa SA
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Harmony and Dycasa is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and Dycasa SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dycasa SA 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 Dycasa SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dycasa SA has no effect on the direction of Harmony Gold i.e., Harmony Gold and Dycasa SA go up and down completely randomly.
Pair Corralation between Harmony Gold and Dycasa SA
Assuming the 90 days trading horizon Harmony Gold Mining is expected to under-perform the Dycasa SA. But the stock apears to be less risky and, when comparing its historical volatility, Harmony Gold Mining is 1.82 times less risky than Dycasa SA. The stock trades about -0.12 of its potential returns per unit of risk. The Dycasa SA is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 51,500 in Dycasa SA on August 30, 2024 and sell it today you would earn a total of 43,600 from holding Dycasa SA or generate 84.66% 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. Dycasa SA
Performance |
| Timeline |
| Harmony Gold Mining |
| Dycasa SA |
Harmony Gold and Dycasa SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harmony Gold and Dycasa SA
The main advantage of trading using opposite Harmony Gold and Dycasa SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, Dycasa SA 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 Dycasa SA will offset losses from the drop in Dycasa SA's long position.| Harmony Gold vs. Vista Energy, SAB | Harmony Gold vs. United States Steel | Harmony Gold vs. Central Puerto SA | Harmony Gold vs. Pfizer Inc |
| Dycasa SA vs. Edesa Holding SA | Dycasa SA vs. Longvie SA | Dycasa SA vs. Vista Energy, SAB | Dycasa SA vs. Embotelladora Andina 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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