Correlation Between Harmony Gold and Rupert Resources
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and Rupert 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 Rupert 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 Rupert Resources, you can compare the effects of market volatilities on Harmony Gold and Rupert 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 Rupert Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and Rupert Resources.
Diversification Opportunities for Harmony Gold and Rupert Resources
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Harmony and Rupert is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and Rupert Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rupert Resources 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 Rupert Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rupert Resources has no effect on the direction of Harmony Gold i.e., Harmony Gold and Rupert Resources go up and down completely randomly.
Pair Corralation between Harmony Gold and Rupert Resources
Considering the 90-day investment horizon Harmony Gold Mining is expected to generate 1.1 times more return on investment than Rupert Resources. However, Harmony Gold is 1.1 times more volatile than Rupert Resources. It trades about 0.28 of its potential returns per unit of risk. Rupert Resources is currently generating about 0.11 per unit of risk. If you would invest 1,205 in Harmony Gold Mining on January 10, 2025 and sell it today you would earn a total of 395.00 from holding Harmony Gold Mining or generate 32.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harmony Gold Mining vs. Rupert Resources
Performance |
| Timeline |
| Harmony Gold Mining |
| Rupert Resources |
Harmony Gold and Rupert Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harmony Gold and Rupert Resources
The main advantage of trading using opposite Harmony Gold and Rupert Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, Rupert 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 Rupert Resources will offset losses from the drop in Rupert 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 |
| Rupert Resources vs. Steppe Gold | Rupert Resources vs. Grande Portage Resources | Rupert Resources vs. Cerrado Gold | Rupert Resources vs. Sarama Resources |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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