Correlation Between Wallbox NV and IONQ

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

By analyzing existing cross correlation between Wallbox NV and IONQ Inc, you can compare the effects of market volatilities on Wallbox NV and IONQ 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 IONQ. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wallbox NV and IONQ.

Diversification Opportunities for Wallbox NV and IONQ

-0.95

Correlation Coefficient

Wallbox NV  IONQ

Pay attention - limited upside

The 3 months correlation between Wallbox and IONQ is -0.95. Overlapping area represents the amount of risk that can be diversified away by holding Wallbox NV and IONQ Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IONQ Inc 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 are associated (or correlated) with IONQ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IONQ Inc has no effect on the direction of Wallbox NV i.e., Wallbox NV and IONQ go up and down completely randomly.

Pair Corralation between Wallbox NV and IONQ

Considering the 90-day investment horizon Wallbox NV is expected to under-perform the IONQ. But the stock apears to be less risky and, when comparing its historical volatility, Wallbox NV is 1.16 times less risky than IONQ. The stock trades about -0.23 of its potential returns per unit of risk. The IONQ Inc is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  2,914  in IONQ Inc on September 16, 2024 and sell it today you would earn a total of  469.00  from holding IONQ Inc or generate 16.09% return on investment over 90 days.

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

Wallbox NV  vs.  IONQ Inc

Wallbox NV

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Wallbox NV has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental drivers remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

IONQ Inc

Risk-Adjusted Performance

24 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in IONQ Inc are ranked lower than 24 (%) of all global equities and portfolios over the last 90 days. Even with relatively inconsistent basic indicators, IONQ reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Wallbox NV and IONQ

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

The idea behind Wallbox NV and IONQ 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 Transaction History module to view history of all your transactions and understand their impact on performance.