Correlation Between Wallbridge Mining and Belo Sun

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

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

Diversification Opportunities for Wallbridge Mining and Belo Sun

0.4

Correlation Coefficient

Wallbridge Mining  Belo Sun

Very weak diversification

The 3 months correlation between Wallbridge and Belo is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Wallbridge Mining and Belo Sun Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Belo Sun Mining and Wallbridge 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 Wallbridge Mining are associated (or correlated) with Belo Sun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Belo Sun Mining has no effect on the direction of Wallbridge Mining i.e., Wallbridge Mining and Belo Sun go up and down completely randomly.

Pair Corralation between Wallbridge Mining and Belo Sun

Assuming the 90 days horizon Wallbridge Mining is expected to generate 1.2 times less return on investment than Belo Sun. In addition to that, Wallbridge Mining is 1.7 times more volatile than Belo Sun Mining. It trades about 0.07 of its total potential returns per unit of risk. Belo Sun Mining is currently generating about 0.15 per unit of volatility. If you would invest  21.00  in Belo Sun Mining on April 24, 2025 and sell it today you would earn a total of  11.00  from holding Belo Sun Mining or generate 52.38% return on investment over 90 days.

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

Wallbridge Mining  vs.  Belo Sun Mining

Wallbridge Mining

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Wallbridge Mining are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile basic indicators, Wallbridge Mining displayed solid returns over the last few months and may actually be approaching a breakup point.

Belo Sun Mining

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Belo Sun Mining are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Belo Sun displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Wallbridge Mining and Belo Sun

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

The idea behind Wallbridge Mining and Belo Sun Mining 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.

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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.