Correlation Between Waystar Holding and Belden

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

By analyzing existing cross correlation between Waystar Holding Corp and Belden Inc, you can compare the effects of market volatilities on Waystar Holding and Belden 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 Waystar Holding with a short position of Belden. Check out your portfolio center. Please also check ongoing floating volatility patterns of Waystar Holding and Belden.

Diversification Opportunities for Waystar Holding and Belden

-0.24

Correlation Coefficient

Waystar Holding  Belden

Very good diversification

The 3 months correlation between Waystar and Belden is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Waystar Holding Corp and Belden Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Belden Inc and Waystar Holding 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 Waystar Holding Corp are associated (or correlated) with Belden. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Belden Inc has no effect on the direction of Waystar Holding i.e., Waystar Holding and Belden go up and down completely randomly.

Pair Corralation between Waystar Holding and Belden

Considering the 90-day investment horizon Waystar Holding Corp is expected to generate 0.87 times more return on investment than Belden. However, Waystar Holding Corp is 1.15 times less risky than Belden. It trades about 0.21 of its potential returns per unit of risk. Belden Inc is currently generating about 0.05 per unit of risk. If you would invest  2,070  in Waystar Holding Corp on October 10, 2024 and sell it today you would earn a total of  1,680  from holding Waystar Holding Corp or generate 81.16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	29.7%
Values	Daily Returns

Waystar Holding Corp  vs.  Belden Inc

Waystar Holding Corp

Risk-Adjusted Performance

21 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Waystar Holding Corp are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady basic indicators, Waystar Holding showed solid returns over the last few months and may actually be approaching a breakup point.

Belden Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Belden Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, Belden is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Waystar Holding and Belden

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

The idea behind Waystar Holding Corp and Belden Inc 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.