Correlation Between Harmony Gold and BURLINGTON STORES
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and BURLINGTON STORES 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 BURLINGTON STORES 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 BURLINGTON STORES, you can compare the effects of market volatilities on Harmony Gold and BURLINGTON STORES 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 BURLINGTON STORES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and BURLINGTON STORES.
Diversification Opportunities for Harmony Gold and BURLINGTON STORES
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Harmony and BURLINGTON is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and BURLINGTON STORES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BURLINGTON STORES 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 BURLINGTON STORES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BURLINGTON STORES has no effect on the direction of Harmony Gold i.e., Harmony Gold and BURLINGTON STORES go up and down completely randomly.
Pair Corralation between Harmony Gold and BURLINGTON STORES
Assuming the 90 days horizon Harmony Gold Mining is expected to under-perform the BURLINGTON STORES. In addition to that, Harmony Gold is 1.61 times more volatile than BURLINGTON STORES. It trades about -0.05 of its total potential returns per unit of risk. BURLINGTON STORES is currently generating about 0.1 per unit of volatility. If you would invest 24,200 in BURLINGTON STORES on September 25, 2024 and sell it today you would earn a total of 3,200 from holding BURLINGTON STORES or generate 13.22% 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. BURLINGTON STORES
Performance |
Timeline |
Harmony Gold Mining |
BURLINGTON STORES |
Harmony Gold and BURLINGTON STORES Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Harmony Gold and BURLINGTON STORES
The main advantage of trading using opposite Harmony Gold and BURLINGTON STORES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, BURLINGTON STORES 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 BURLINGTON STORES will offset losses from the drop in BURLINGTON STORES's long position.Harmony Gold vs. ZIJIN MINH UNSPADR20 | Harmony Gold vs. Newmont | Harmony Gold vs. Barrick Gold | Harmony Gold vs. Franco Nevada |
BURLINGTON STORES vs. Mobilezone Holding AG | BURLINGTON STORES vs. Shenandoah Telecommunications | BURLINGTON STORES vs. MINCO SILVER | BURLINGTON STORES vs. Harmony Gold Mining |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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