Correlation Between Q2 Metals and Harmony Gold
Can any of the company-specific risk be diversified away by investing in both Q2 Metals 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 Q2 Metals and Harmony Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Q2 Metals Corp and Harmony Gold Mining, you can compare the effects of market volatilities on Q2 Metals 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 Q2 Metals with a short position of Harmony Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Q2 Metals and Harmony Gold.
Diversification Opportunities for Q2 Metals and Harmony Gold
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between QUEXF and Harmony is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Q2 Metals Corp 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 Q2 Metals 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 Q2 Metals Corp 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 Q2 Metals i.e., Q2 Metals and Harmony Gold go up and down completely randomly.
Pair Corralation between Q2 Metals and Harmony Gold
Assuming the 90 days horizon Q2 Metals Corp is expected to generate 2.11 times more return on investment than Harmony Gold. However, Q2 Metals is 2.11 times more volatile than Harmony Gold Mining. It trades about -0.07 of its potential returns per unit of risk. Harmony Gold Mining is currently generating about -0.21 per unit of risk. If you would invest 72.00 in Q2 Metals Corp on September 4, 2024 and sell it today you would lose (10.00) from holding Q2 Metals Corp or give up 13.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Q2 Metals Corp vs. Harmony Gold Mining
Performance |
| Timeline |
| Q2 Metals Corp |
| Harmony Gold Mining |
Q2 Metals and Harmony Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Q2 Metals and Harmony Gold
The main advantage of trading using opposite Q2 Metals and Harmony Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Q2 Metals 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.| Q2 Metals vs. Harmony Gold Mining | Q2 Metals vs. SPACE | Q2 Metals vs. T Rowe Price | Q2 Metals vs. Ampleforth |
| 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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