Correlation Between Harmony Gold and Comba Telecom
Can any of the company-specific risk be diversified away by investing in both Harmony Gold and Comba Telecom 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 Comba Telecom 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 Comba Telecom Systems, you can compare the effects of market volatilities on Harmony Gold and Comba Telecom 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 Comba Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harmony Gold and Comba Telecom.
Diversification Opportunities for Harmony Gold and Comba Telecom
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Harmony and Comba is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Harmony Gold Mining and Comba Telecom Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comba Telecom Systems 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 Comba Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comba Telecom Systems has no effect on the direction of Harmony Gold i.e., Harmony Gold and Comba Telecom go up and down completely randomly.
Pair Corralation between Harmony Gold and Comba Telecom
Assuming the 90 days horizon Harmony Gold Mining is expected to under-perform the Comba Telecom. But the stock apears to be less risky and, when comparing its historical volatility, Harmony Gold Mining is 1.98 times less risky than Comba Telecom. The stock trades about -0.19 of its potential returns per unit of risk. The Comba Telecom Systems is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 11.00 in Comba Telecom Systems on September 25, 2024 and sell it today you would earn a total of 2.00 from holding Comba Telecom Systems or generate 18.18% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Harmony Gold Mining vs. Comba Telecom Systems
Performance |
Timeline |
Harmony Gold Mining |
Comba Telecom Systems |
Harmony Gold and Comba Telecom Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Harmony Gold and Comba Telecom
The main advantage of trading using opposite Harmony Gold and Comba Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harmony Gold position performs unexpectedly, Comba Telecom 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 Comba Telecom will offset losses from the drop in Comba Telecom's long position.Harmony Gold vs. ZIJIN MINH UNSPADR20 | Harmony Gold vs. Newmont | Harmony Gold vs. Barrick Gold | Harmony Gold vs. Franco Nevada |
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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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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