Correlation Between HUMANA and Harmony Gold
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By analyzing existing cross correlation between HUMANA INC and Harmony Gold Mining, you can compare the effects of market volatilities on HUMANA 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 HUMANA with a short position of Harmony Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Harmony Gold.
Diversification Opportunities for HUMANA and Harmony Gold
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between HUMANA and Harmony is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA 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 HUMANA 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 HUMANA 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 HUMANA i.e., HUMANA and Harmony Gold go up and down completely randomly.
Pair Corralation between HUMANA and Harmony Gold
Assuming the 90 days trading horizon HUMANA INC is expected to generate 15.59 times more return on investment than Harmony Gold. However, HUMANA is 15.59 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 0.1 per unit of risk. If you would invest 7,891 in HUMANA INC on September 12, 2024 and sell it today you would lose (196.00) from holding HUMANA INC or give up 2.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 52.46% |
| Values | Daily Returns |
HUMANA INC vs. Harmony Gold Mining
Performance |
| Timeline |
| HUMANA INC |
| Harmony Gold Mining |
HUMANA and Harmony Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Harmony Gold
The main advantage of trading using opposite HUMANA and Harmony Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA 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.The idea behind HUMANA INC and Harmony Gold Mining pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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