Correlation Between Harmony Gold and Richter Gedeon
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and Richter Gedeon 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 Richter Gedeon 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 Richter Gedeon Vegyszeti, you can compare the effects of market volatilities on Harmony Gold and Richter Gedeon 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 Richter Gedeon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and Richter Gedeon.
Diversification Opportunities for Harmony Gold and Richter Gedeon
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Harmony and Richter is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and Richter Gedeon Vegyszeti in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Richter Gedeon Vegyszeti 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 Richter Gedeon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Richter Gedeon Vegyszeti has no effect on the direction of Harmony Gold i.e., Harmony Gold and Richter Gedeon go up and down completely randomly.
Pair Corralation between Harmony Gold and Richter Gedeon
Assuming the 90 days horizon Harmony Gold Mining is expected to generate 1.56 times more return on investment than Richter Gedeon. However, Harmony Gold is 1.56 times more volatile than Richter Gedeon Vegyszeti. It trades about 0.06 of its potential returns per unit of risk. Richter Gedeon Vegyszeti is currently generating about 0.07 per unit of risk. If you would invest 840.00 in Harmony Gold Mining on December 4, 2024 and sell it today you would earn a total of 70.00 from holding Harmony Gold Mining or generate 8.33% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Harmony Gold Mining vs. Richter Gedeon Vegyszeti
Performance |
Timeline |
Harmony Gold Mining |
Richter Gedeon Vegyszeti |
Harmony Gold and Richter Gedeon Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Harmony Gold and Richter Gedeon
The main advantage of trading using opposite Harmony Gold and Richter Gedeon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, Richter Gedeon 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 Richter Gedeon will offset losses from the drop in Richter Gedeon's long position.Harmony Gold vs. Canadian Utilities Limited | Harmony Gold vs. INTERSHOP Communications Aktiengesellschaft | Harmony Gold vs. Chengdu PUTIAN Telecommunications | Harmony Gold vs. NORTHEAST UTILITIES |
Richter Gedeon vs. SCANSOURCE | Richter Gedeon vs. UNIVMUSIC GRPADR050 | Richter Gedeon vs. MOVIE GAMES SA | Richter Gedeon vs. Luckin Coffee |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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