Correlation Between Harmony Gold and Capital Clean
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and Capital Clean 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 Capital Clean 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 Capital Clean Energy, you can compare the effects of market volatilities on Harmony Gold and Capital Clean 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 Capital Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and Capital Clean.
Diversification Opportunities for Harmony Gold and Capital Clean
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Harmony and Capital is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and Capital Clean Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capital Clean Energy 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 Capital Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capital Clean Energy has no effect on the direction of Harmony Gold i.e., Harmony Gold and Capital Clean go up and down completely randomly.
Pair Corralation between Harmony Gold and Capital Clean
Considering the 90-day investment horizon Harmony Gold Mining is expected to generate 1.66 times more return on investment than Capital Clean. However, Harmony Gold is 1.66 times more volatile than Capital Clean Energy. It trades about 0.07 of its potential returns per unit of risk. Capital Clean Energy is currently generating about 0.07 per unit of risk. If you would invest 584.00 in Harmony Gold Mining on September 3, 2024 and sell it today you would earn a total of 308.00 from holding Harmony Gold Mining or generate 52.74% 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. Capital Clean Energy
Performance |
| Timeline |
| Harmony Gold Mining |
| Capital Clean Energy |
Harmony Gold and Capital Clean Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harmony Gold and Capital Clean
The main advantage of trading using opposite Harmony Gold and Capital Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, Capital Clean 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 Capital Clean will offset losses from the drop in Capital Clean'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 |
| Capital Clean vs. Electrovaya Common Shares | Capital Clean vs. Zoom Video Communications | Capital Clean vs. Videolocity International | Capital Clean vs. Hurco Companies |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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