Correlation Between Iluka Resources and Harvest Technology

Can any of the company-specific risk be diversified away by investing in both Iluka Resources and Harvest Technology 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 Iluka Resources and Harvest Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Iluka Resources and Harvest Technology Group, you can compare the effects of market volatilities on Iluka Resources and Harvest Technology 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 Iluka Resources with a short position of Harvest Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Iluka Resources and Harvest Technology.

Diversification Opportunities for Iluka Resources and Harvest Technology

0.49

Correlation Coefficient

Iluka Resources  Harvest Technology

Very weak diversification

The 3 months correlation between Iluka and Harvest is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Iluka Resources and Harvest Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harvest Technology and Iluka Resources 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 Iluka Resources are associated (or correlated) with Harvest Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harvest Technology has no effect on the direction of Iluka Resources i.e., Iluka Resources and Harvest Technology go up and down completely randomly.

Pair Corralation between Iluka Resources and Harvest Technology

Assuming the 90 days trading horizon Iluka Resources is expected to generate 0.42 times more return on investment than Harvest Technology. However, Iluka Resources is 2.4 times less risky than Harvest Technology. It trades about -0.12 of its potential returns per unit of risk. Harvest Technology Group is currently generating about -0.15 per unit of risk. If you would invest  494.00  in Iluka Resources on December 22, 2024 and sell it today you would lose (80.00) from holding Iluka Resources or give up 16.19% of portfolio value over 90 days.

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

Iluka Resources  vs.  Harvest Technology Group

Iluka Resources

Risk-Adjusted Performance

Very Weak

Over the last 90 days Iluka Resources has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Harvest Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Harvest Technology Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's technical and fundamental indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Iluka Resources and Harvest Technology

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

The idea behind Iluka Resources and Harvest Technology Group 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.