Correlation Between Wallbox NV and Cedar Realty

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

By analyzing existing cross correlation between Wallbox NV WT and Cedar Realty Trust, you can compare the effects of market volatilities on Wallbox NV and Cedar Realty 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 Wallbox NV with a short position of Cedar Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wallbox NV and Cedar Realty.

Diversification Opportunities for Wallbox NV and Cedar Realty

0.01

Correlation Coefficient

Wallbox NV  Cedar Realty

Significant diversification

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

Pair Corralation between Wallbox NV and Cedar Realty

Assuming the 90 days trading horizon Wallbox NV WT is expected to generate 9.98 times more return on investment than Cedar Realty. However, Wallbox NV is 9.98 times more volatile than Cedar Realty Trust. It trades about 0.08 of its potential returns per unit of risk. Cedar Realty Trust is currently generating about 0.0 per unit of risk. If you would invest  8.48  in Wallbox NV WT on October 6, 2024 and sell it today you would lose (3.73) from holding Wallbox NV WT or give up 43.99% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	79.03%
Values	Daily Returns

Wallbox NV WT  vs.  Cedar Realty Trust

Wallbox NV WT

Risk-Adjusted Performance

5 of 100

Modest

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

Cedar Realty Trust

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cedar Realty Trust has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Cedar Realty is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Wallbox NV and Cedar Realty

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

The idea behind Wallbox NV WT and Cedar Realty Trust 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.