Correlation Between Foran Mining and Westbridge Energy

Can any of the company-specific risk be diversified away by investing in both Foran Mining and Westbridge Energy 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 Foran Mining and Westbridge Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Foran Mining and Westbridge Energy, you can compare the effects of market volatilities on Foran Mining and Westbridge Energy 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 Foran Mining with a short position of Westbridge Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Foran Mining and Westbridge Energy.

Diversification Opportunities for Foran Mining and Westbridge Energy

-0.01

Correlation Coefficient

Foran Mining  Westbridge Energy

Good diversification

The 3 months correlation between Foran and Westbridge is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Foran Mining and Westbridge Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westbridge Energy and Foran Mining 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 Foran Mining are associated (or correlated) with Westbridge Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westbridge Energy has no effect on the direction of Foran Mining i.e., Foran Mining and Westbridge Energy go up and down completely randomly.

Pair Corralation between Foran Mining and Westbridge Energy

Assuming the 90 days trading horizon Foran Mining is expected to under-perform the Westbridge Energy. But the stock apears to be less risky and, when comparing its historical volatility, Foran Mining is 1.42 times less risky than Westbridge Energy. The stock trades about -0.1 of its potential returns per unit of risk. The Westbridge Energy is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  58.00  in Westbridge Energy on April 22, 2025 and sell it today you would earn a total of  11.00  from holding Westbridge Energy or generate 18.97% return on investment over 90 days.

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

Foran Mining  vs.  Westbridge Energy

Foran Mining

Risk-Adjusted Performance

Very Weak

Over the last 90 days Foran Mining has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's primary indicators remain very healthy which may send shares a bit higher in August 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Westbridge Energy

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Westbridge Energy are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Westbridge Energy showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Foran Mining and Westbridge Energy

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

The idea behind Foran Mining and Westbridge Energy 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 Commodity Directory module to find actively traded commodities issued by global exchanges.