Correlation Between Harmony Gold and Nasdaq
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and Nasdaq 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 Nasdaq 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 Nasdaq Inc, you can compare the effects of market volatilities on Harmony Gold and Nasdaq 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 Nasdaq. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and Nasdaq.
Diversification Opportunities for Harmony Gold and Nasdaq
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Harmony and Nasdaq is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and Nasdaq Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nasdaq Inc 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 Nasdaq. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nasdaq Inc has no effect on the direction of Harmony Gold i.e., Harmony Gold and Nasdaq go up and down completely randomly.
Pair Corralation between Harmony Gold and Nasdaq
Considering the 90-day investment horizon Harmony Gold Mining is expected to generate 2.18 times more return on investment than Nasdaq. However, Harmony Gold is 2.18 times more volatile than Nasdaq Inc. It trades about 0.62 of its potential returns per unit of risk. Nasdaq Inc is currently generating about 0.28 per unit of risk. If you would invest 848.00 in Harmony Gold Mining on November 2, 2024 and sell it today you would earn a total of 287.00 from holding Harmony Gold Mining or generate 33.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harmony Gold Mining vs. Nasdaq Inc
Performance |
| Timeline |
| Harmony Gold Mining |
| Nasdaq Inc |
Harmony Gold and Nasdaq Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harmony Gold and Nasdaq
The main advantage of trading using opposite Harmony Gold and Nasdaq positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, Nasdaq 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 Nasdaq will offset losses from the drop in Nasdaq'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 |
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 Stocks Directory module to find actively traded stocks across global markets.
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