Correlation Between Harmony Gold and Brunswick Exploration
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and Brunswick Exploration 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 Brunswick Exploration 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 Brunswick Exploration, you can compare the effects of market volatilities on Harmony Gold and Brunswick Exploration 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 Brunswick Exploration. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and Brunswick Exploration.
Diversification Opportunities for Harmony Gold and Brunswick Exploration
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Harmony and Brunswick is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and Brunswick Exploration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brunswick Exploration 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 Brunswick Exploration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brunswick Exploration has no effect on the direction of Harmony Gold i.e., Harmony Gold and Brunswick Exploration go up and down completely randomly.
Pair Corralation between Harmony Gold and Brunswick Exploration
Considering the 90-day investment horizon Harmony Gold Mining is expected to generate 0.49 times more return on investment than Brunswick Exploration. However, Harmony Gold Mining is 2.03 times less risky than Brunswick Exploration. It trades about 0.07 of its potential returns per unit of risk. Brunswick Exploration is currently generating about 0.0 per unit of risk. If you would invest 343.00 in Harmony Gold Mining on September 4, 2024 and sell it today you would earn a total of 549.00 from holding Harmony Gold Mining or generate 160.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harmony Gold Mining vs. Brunswick Exploration
Performance |
| Timeline |
| Harmony Gold Mining |
| Brunswick Exploration |
Harmony Gold and Brunswick Exploration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harmony Gold and Brunswick Exploration
The main advantage of trading using opposite Harmony Gold and Brunswick Exploration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, Brunswick Exploration 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 Brunswick Exploration will offset losses from the drop in Brunswick Exploration's long position.| Harmony Gold vs. AngloGold Ashanti plc | Harmony Gold vs. Eldorado Gold Corp | Harmony Gold vs. Kinross Gold | Harmony Gold vs. Pan American Silver |
| Brunswick Exploration vs. Heliostar Metals | Brunswick Exploration vs. Independence Gold Corp | Brunswick Exploration vs. Westward Gold | Brunswick Exploration vs. Snowline Gold Corp |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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