Correlation Between Vera Bradley and Harmony Gold
Can any of the company-specific risk be diversified away by investing in both Vera Bradley 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 Vera Bradley and Harmony Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vera Bradley and Harmony Gold Mining, you can compare the effects of market volatilities on Vera Bradley 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 Vera Bradley with a short position of Harmony Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vera Bradley and Harmony Gold.
Diversification Opportunities for Vera Bradley and Harmony Gold
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Vera and Harmony is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Vera Bradley 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 Vera Bradley 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 Vera Bradley 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 Vera Bradley i.e., Vera Bradley and Harmony Gold go up and down completely randomly.
Pair Corralation between Vera Bradley and Harmony Gold
Considering the 90-day investment horizon Vera Bradley is expected to generate 0.89 times more return on investment than Harmony Gold. However, Vera Bradley is 1.12 times less risky than Harmony Gold. It trades about -0.2 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 536.00 in Vera Bradley on September 13, 2024 and sell it today you would lose (93.00) from holding Vera Bradley or give up 17.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vera Bradley vs. Harmony Gold Mining
Performance |
| Timeline |
| Vera Bradley |
| Harmony Gold Mining |
Vera Bradley and Harmony Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vera Bradley and Harmony Gold
The main advantage of trading using opposite Vera Bradley and Harmony Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vera Bradley 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.| Vera Bradley vs. Rocky Brands | Vera Bradley vs. Steven Madden | Vera Bradley vs. Wolverine World Wide | Vera Bradley vs. Caleres |
| 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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