Correlation Between Harmony Gold and CVW CLEANTECH

Can any of the company-specific risk be diversified away by investing in both Harmony Gold and CVW CLEANTECH 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 CVW CLEANTECH 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 CVW CLEANTECH INC, you can compare the effects of market volatilities on Harmony Gold and CVW CLEANTECH 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 CVW CLEANTECH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and CVW CLEANTECH.

Diversification Opportunities for Harmony Gold and CVW CLEANTECH

-0.48

Correlation Coefficient

Harmony Gold  CVW CLEANTECH

Very good diversification

The 3 months correlation between Harmony and CVW is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and CVW CLEANTECH INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CVW CLEANTECH INC 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 CVW CLEANTECH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CVW CLEANTECH INC has no effect on the direction of Harmony Gold i.e., Harmony Gold and CVW CLEANTECH go up and down completely randomly.

Pair Corralation between Harmony Gold and CVW CLEANTECH

Assuming the 90 days horizon Harmony Gold Mining is expected to generate 0.89 times more return on investment than CVW CLEANTECH. However, Harmony Gold Mining is 1.12 times less risky than CVW CLEANTECH. It trades about 0.23 of its potential returns per unit of risk. CVW CLEANTECH INC is currently generating about -0.06 per unit of risk. If you would invest  780.00  in Harmony Gold Mining on December 28, 2024 and sell it today you would earn a total of  370.00  from holding Harmony Gold Mining or generate 47.44% return on investment over 90 days.

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

Harmony Gold Mining  vs.  CVW CLEANTECH INC

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 fragile basic indicators, Harmony Gold reported solid returns over the last few months and may actually be approaching a breakup point.

CVW CLEANTECH INC

Risk-Adjusted Performance

Very Weak

Over the last 90 days CVW CLEANTECH INC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's fundamental 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 CVW CLEANTECH

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

The idea behind Harmony Gold Mining and CVW CLEANTECH INC 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.