Correlation Between Harmony Gold and FONIX MOBILE

Can any of the company-specific risk be diversified away by investing in both Harmony Gold and FONIX MOBILE 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 Harmony Gold and FONIX MOBILE into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Harmony Gold Mining and FONIX MOBILE PLC, you can compare the effects of market volatilities on Harmony Gold and FONIX MOBILE 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 Harmony Gold with a short position of FONIX MOBILE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and FONIX MOBILE.

Diversification Opportunities for Harmony Gold and FONIX MOBILE

-0.12

Correlation Coefficient

Harmony Gold  FONIX MOBILE

Good diversification

The 3 months correlation between Harmony and FONIX is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and FONIX MOBILE PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FONIX MOBILE PLC and Harmony Gold 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 Harmony Gold Mining are associated (or correlated) with FONIX MOBILE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FONIX MOBILE PLC has no effect on the direction of Harmony Gold i.e., Harmony Gold and FONIX MOBILE go up and down completely randomly.

Pair Corralation between Harmony Gold and FONIX MOBILE

Assuming the 90 days horizon Harmony Gold Mining is expected to generate 1.08 times more return on investment than FONIX MOBILE. However, Harmony Gold is 1.08 times more volatile than FONIX MOBILE PLC. It trades about 0.23 of its potential returns per unit of risk. FONIX MOBILE PLC is currently generating about -0.12 per unit of risk. If you would invest  780.00  in Harmony Gold Mining on December 21, 2024 and sell it today you would earn a total of  350.00  from holding Harmony Gold Mining or generate 44.87% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Harmony Gold Mining  vs.  FONIX MOBILE PLC

Harmony Gold Mining

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Harmony Gold Mining are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, Harmony Gold reported solid returns over the last few months and may actually be approaching a breakup point.

FONIX MOBILE PLC

Risk-Adjusted Performance

Very Weak

Over the last 90 days FONIX MOBILE PLC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Harmony Gold and FONIX MOBILE

The main advantage of trading using opposite Harmony Gold and FONIX MOBILE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, FONIX MOBILE 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 FONIX MOBILE will offset losses from the drop in FONIX MOBILE's long position.

The idea behind Harmony Gold Mining and FONIX MOBILE PLC 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.

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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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.