Correlation Between Harmony Gold and Nyxoah

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

Diversification Opportunities for Harmony Gold and Nyxoah

0.6

Correlation Coefficient

Harmony Gold  Nyxoah

Poor diversification

The 3 months correlation between Harmony and Nyxoah is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and Nyxoah in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nyxoah 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 Nyxoah. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nyxoah has no effect on the direction of Harmony Gold i.e., Harmony Gold and Nyxoah go up and down completely randomly.

Pair Corralation between Harmony Gold and Nyxoah

Assuming the 90 days horizon Harmony Gold is expected to generate 2.0 times less return on investment than Nyxoah. But when comparing it to its historical volatility, Harmony Gold Mining is 1.83 times less risky than Nyxoah. It trades about 0.07 of its potential returns per unit of risk. Nyxoah is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  462.00  in Nyxoah on October 6, 2024 and sell it today you would earn a total of  453.00  from holding Nyxoah or generate 98.05% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	76.21%
Values	Daily Returns

Harmony Gold Mining  vs.  Nyxoah

Harmony Gold Mining

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Harmony Gold Mining 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 February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Nyxoah

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Nyxoah has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Nyxoah is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Harmony Gold and Nyxoah

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

The idea behind Harmony Gold Mining and Nyxoah 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.