Correlation Between Harmony Biosciences and SP Global
Can any of the company-specific risk be diversified away by investing in both Harmony Biosciences and SP Global 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 Biosciences and SP Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Harmony Biosciences Holdings and SP Global, you can compare the effects of market volatilities on Harmony Biosciences and SP Global 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 Biosciences with a short position of SP Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Biosciences and SP Global.
Diversification Opportunities for Harmony Biosciences and SP Global
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Harmony and SPGI is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Biosciences Holdings and SP Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SP Global and Harmony Biosciences 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 Biosciences Holdings are associated (or correlated) with SP Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SP Global has no effect on the direction of Harmony Biosciences i.e., Harmony Biosciences and SP Global go up and down completely randomly.
Pair Corralation between Harmony Biosciences and SP Global
Given the investment horizon of 90 days Harmony Biosciences Holdings is expected to generate 2.26 times more return on investment than SP Global. However, Harmony Biosciences is 2.26 times more volatile than SP Global. It trades about 0.24 of its potential returns per unit of risk. SP Global is currently generating about 0.21 per unit of risk. If you would invest 3,453 in Harmony Biosciences Holdings on November 9, 2024 and sell it today you would earn a total of 425.00 from holding Harmony Biosciences Holdings or generate 12.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harmony Biosciences Holdings vs. SP Global
Performance |
| Timeline |
| Harmony Biosciences |
| SP Global |
Harmony Biosciences and SP Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harmony Biosciences and SP Global
The main advantage of trading using opposite Harmony Biosciences and SP Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Biosciences position performs unexpectedly, SP Global 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 SP Global will offset losses from the drop in SP Global's long position.| Harmony Biosciences vs. Keros Therapeutics | Harmony Biosciences vs. Janux Therapeutics | Harmony Biosciences vs. Fennec Pharmaceuticals | Harmony Biosciences vs. Edgewise Therapeutics |
| SP Global vs. MSCI Inc | SP Global vs. Nasdaq Inc | SP Global vs. Intercontinental Exchange | SP Global vs. CME Group |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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