Correlation Between Harmony Gold and Maritime Resources
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and Maritime Resources 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 Maritime Resources 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 Maritime Resources Corp, you can compare the effects of market volatilities on Harmony Gold and Maritime Resources 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 Maritime Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and Maritime Resources.
Diversification Opportunities for Harmony Gold and Maritime Resources
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Harmony and Maritime is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and Maritime Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maritime Resources Corp 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 Maritime Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maritime Resources Corp has no effect on the direction of Harmony Gold i.e., Harmony Gold and Maritime Resources go up and down completely randomly.
Pair Corralation between Harmony Gold and Maritime Resources
Considering the 90-day investment horizon Harmony Gold Mining is expected to under-perform the Maritime Resources. But the stock apears to be less risky and, when comparing its historical volatility, Harmony Gold Mining is 2.01 times less risky than Maritime Resources. The stock trades about -0.18 of its potential returns per unit of risk. The Maritime Resources Corp is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 4.50 in Maritime Resources Corp on September 3, 2024 and sell it today you would lose (0.50) from holding Maritime Resources Corp or give up 11.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harmony Gold Mining vs. Maritime Resources Corp
Performance |
| Timeline |
| Harmony Gold Mining |
| Maritime Resources Corp |
Harmony Gold and Maritime Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harmony Gold and Maritime Resources
The main advantage of trading using opposite Harmony Gold and Maritime Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, Maritime Resources 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 Maritime Resources will offset losses from the drop in Maritime Resources' 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 |
| Maritime Resources vs. Harmony Gold Mining | Maritime Resources vs. SPACE | Maritime Resources vs. T Rowe Price | Maritime Resources vs. Ampleforth |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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