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, 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
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Harmony and CVW is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and CVW CleanTech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CVW CleanTech 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 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
Considering the 90-day investment horizon Harmony Gold Mining is expected to generate 0.99 times more return on investment than CVW CleanTech. However, Harmony Gold Mining is 1.01 times less risky than CVW CleanTech. It trades about 0.61 of its potential returns per unit of risk. CVW CleanTech is currently generating about 0.05 per unit of risk. If you would invest 831.00 in Harmony Gold Mining on October 26, 2024 and sell it today you would earn a total of 255.50 from holding Harmony Gold Mining or generate 30.75% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 94.74% |
Values | Daily Returns |
Harmony Gold Mining vs. CVW CleanTech
Performance |
Timeline |
Harmony Gold Mining |
CVW CleanTech |
Harmony Gold and CVW CleanTech Volatility Contrast
Predicted Return Density |
Returns |
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.Harmony Gold vs. AngloGold Ashanti plc | Harmony Gold vs. Eldorado Gold Corp | Harmony Gold vs. Kinross Gold | Harmony Gold vs. Pan American Silver |
CVW CleanTech vs. The Gap, | CVW CleanTech vs. Jerash Holdings | CVW CleanTech vs. IPG Photonics | CVW CleanTech vs. Everspin Technologies |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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