Correlation Between Tyson Foods and Harmony Gold
Can any of the company-specific risk be diversified away by investing in both Tyson Foods 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 Tyson Foods and Harmony Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tyson Foods and Harmony Gold Mining, you can compare the effects of market volatilities on Tyson Foods 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 Tyson Foods with a short position of Harmony Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tyson Foods and Harmony Gold.
Diversification Opportunities for Tyson Foods and Harmony Gold
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tyson and Harmony is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Tyson Foods 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 Tyson Foods 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 Tyson Foods 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 Tyson Foods i.e., Tyson Foods and Harmony Gold go up and down completely randomly.
Pair Corralation between Tyson Foods and Harmony Gold
Considering the 90-day investment horizon Tyson Foods is expected to generate 0.32 times more return on investment than Harmony Gold. However, Tyson Foods is 3.16 times less risky than Harmony Gold. It trades about 0.14 of its potential returns per unit of risk. Harmony Gold Mining is currently generating about -0.03 per unit of risk. If you would invest 5,956 in Tyson Foods on August 30, 2024 and sell it today you would earn a total of 489.00 from holding Tyson Foods or generate 8.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 93.18% |
| Values | Daily Returns |
Tyson Foods vs. Harmony Gold Mining
Performance |
| Timeline |
| Tyson Foods |
| Harmony Gold Mining |
Tyson Foods and Harmony Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tyson Foods and Harmony Gold
The main advantage of trading using opposite Tyson Foods and Harmony Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tyson Foods 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.| Tyson Foods vs. Bunge Limited | Tyson Foods vs. Cal Maine Foods | Tyson Foods vs. Dole PLC | Tyson Foods vs. Adecoagro SA |
| Harmony Gold vs. SNDL Inc | Harmony Gold vs. Tyson Foods | Harmony Gold vs. Century Aluminum | Harmony Gold vs. Olympic Steel |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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