Correlation Between Saia and Harmony Gold
Can any of the company-specific risk be diversified away by investing in both Saia 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 Saia and Harmony Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saia Inc and Harmony Gold Mining, you can compare the effects of market volatilities on Saia 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 Saia with a short position of Harmony Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saia and Harmony Gold.
Diversification Opportunities for Saia and Harmony Gold
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Saia and Harmony is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Saia Inc 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 Saia 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 Saia Inc 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 Saia i.e., Saia and Harmony Gold go up and down completely randomly.
Pair Corralation between Saia and Harmony Gold
Given the investment horizon of 90 days Saia is expected to generate 4.28 times less return on investment than Harmony Gold. But when comparing it to its historical volatility, Saia Inc is 1.63 times less risky than Harmony Gold. It trades about 0.04 of its potential returns per unit of risk. Harmony Gold Mining is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 475.00 in Harmony Gold Mining on September 12, 2024 and sell it today you would earn a total of 475.00 from holding Harmony Gold Mining or generate 100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 51.42% |
| Values | Daily Returns |
Saia Inc vs. Harmony Gold Mining
Performance |
| Timeline |
| Saia Inc |
| Harmony Gold Mining |
Saia and Harmony Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saia and Harmony Gold
The main advantage of trading using opposite Saia and Harmony Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saia 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.| Saia vs. ArcBest Corp | Saia vs. Marten Transport | Saia vs. Werner Enterprises | Saia vs. Knight Transportation |
| 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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