Correlation Between National CineMedia and Harmony Gold
Can any of the company-specific risk be diversified away by investing in both National CineMedia 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 National CineMedia and Harmony Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National CineMedia and Harmony Gold Mining, you can compare the effects of market volatilities on National CineMedia 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 National CineMedia with a short position of Harmony Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of National CineMedia and Harmony Gold.
Diversification Opportunities for National CineMedia and Harmony Gold
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between National and Harmony is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding National CineMedia 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 National CineMedia 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 National CineMedia 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 National CineMedia i.e., National CineMedia and Harmony Gold go up and down completely randomly.
Pair Corralation between National CineMedia and Harmony Gold
Given the investment horizon of 90 days National CineMedia is expected to under-perform the Harmony Gold. But the stock apears to be less risky and, when comparing its historical volatility, National CineMedia is 3.57 times less risky than Harmony Gold. The stock trades about -0.03 of its potential returns per unit of risk. The Harmony Gold Mining is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 949.00 in Harmony Gold Mining on November 28, 2024 and sell it today you would earn a total of 251.00 from holding Harmony Gold Mining or generate 26.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
National CineMedia vs. Harmony Gold Mining
Performance |
| Timeline |
| National CineMedia |
| Harmony Gold Mining |
National CineMedia and Harmony Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National CineMedia and Harmony Gold
The main advantage of trading using opposite National CineMedia and Harmony Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National CineMedia 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.| National CineMedia vs. MGO Global Common | National CineMedia vs. Baosheng Media Group | National CineMedia vs. Impact Fusion International | National CineMedia vs. ZW Data Action |
| Harmony Gold vs. Where Food Comes | Harmony Gold vs. Cheche Group Class | Harmony Gold vs. Sprinklr | Harmony Gold vs. Asure Software |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Commodity Directory Find actively traded commodities issued by global exchanges |