Correlation Between Eastman Kodak and Harmony Gold
Can any of the company-specific risk be diversified away by investing in both Eastman Kodak and Harmony Gold 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 Eastman Kodak and Harmony Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eastman Kodak Co and Harmony Gold Mining, you can compare the effects of market volatilities on Eastman Kodak and Harmony Gold 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 Eastman Kodak with a short position of Harmony Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastman Kodak and Harmony Gold.
Diversification Opportunities for Eastman Kodak and Harmony Gold
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Eastman and Harmony is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Eastman Kodak Co and Harmony Gold Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harmony Gold Mining and Eastman Kodak 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 Eastman Kodak Co are associated (or correlated) with Harmony Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harmony Gold Mining has no effect on the direction of Eastman Kodak i.e., Eastman Kodak and Harmony Gold go up and down completely randomly.
Pair Corralation between Eastman Kodak and Harmony Gold
Given the investment horizon of 90 days Eastman Kodak Co is expected to generate 1.3 times more return on investment than Harmony Gold. However, Eastman Kodak is 1.3 times more volatile than Harmony Gold Mining. It trades about 0.05 of its potential returns per unit of risk. Harmony Gold Mining is currently generating about 0.05 per unit of risk. If you would invest 594.00 in Eastman Kodak Co on September 13, 2024 and sell it today you would earn a total of 84.00 from holding Eastman Kodak Co or generate 14.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 97.6% |
| Values | Daily Returns |
Eastman Kodak Co vs. Harmony Gold Mining
Performance |
| Timeline |
| Eastman Kodak |
| Harmony Gold Mining |
Eastman Kodak and Harmony Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastman Kodak and Harmony Gold
The main advantage of trading using opposite Eastman Kodak and Harmony Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastman Kodak position performs unexpectedly, Harmony Gold 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 Harmony Gold will offset losses from the drop in Harmony Gold's long position.| Eastman Kodak vs. SMX Public Limited | Eastman Kodak vs. System1 | Eastman Kodak vs. Lichen China Limited | Eastman Kodak vs. Team Inc |
| Harmony Gold vs. Revival Gold | Harmony Gold vs. Galiano Gold | Harmony Gold vs. US Gold Corp | Harmony Gold vs. HUMANA INC |
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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