Correlation Between Wallbox NV and Universal

Can any of the company-specific risk be diversified away by investing in both Wallbox NV and Universal 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 Universal 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 Universal, you can compare the effects of market volatilities on Wallbox NV and Universal 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 Universal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wallbox NV and Universal.

Diversification Opportunities for Wallbox NV and Universal

-0.65

Correlation Coefficient

Wallbox NV  Universal

Excellent diversification

The 3 months correlation between Wallbox and Universal is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Wallbox NV WT and Universal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Universal 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 Universal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Universal has no effect on the direction of Wallbox NV i.e., Wallbox NV and Universal go up and down completely randomly.

Pair Corralation between Wallbox NV and Universal

Assuming the 90 days trading horizon Wallbox NV WT is expected to generate 50.29 times more return on investment than Universal. However, Wallbox NV is 50.29 times more volatile than Universal. It trades about 0.16 of its potential returns per unit of risk. Universal is currently generating about -0.22 per unit of risk. If you would invest  5.00  in Wallbox NV WT on October 6, 2024 and sell it today you would lose (0.25) from holding Wallbox NV WT or give up 5.0% of portfolio value over 90 days.

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

Wallbox NV WT  vs.  Universal

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.

Universal

Risk-Adjusted Performance

7 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Universal are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Universal may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Wallbox NV and Universal

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

The idea behind Wallbox NV WT and Universal 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.