Correlation Between Wallbox NV and New Pacific

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

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

Diversification Opportunities for Wallbox NV and New Pacific

-0.31

Correlation Coefficient

Wallbox NV  New Pacific

Very good diversification

The 3 months correlation between Wallbox and New is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Wallbox NV and New Pacific Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Pacific Metals 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 New Pacific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Pacific Metals has no effect on the direction of Wallbox NV i.e., Wallbox NV and New Pacific go up and down completely randomly.

Pair Corralation between Wallbox NV and New Pacific

Considering the 90-day investment horizon Wallbox NV is expected to under-perform the New Pacific. In addition to that, Wallbox NV is 1.95 times more volatile than New Pacific Metals. It trades about -0.18 of its total potential returns per unit of risk. New Pacific Metals is currently generating about 0.0 per unit of volatility. If you would invest  153.00  in New Pacific Metals on September 13, 2024 and sell it today you would lose (2.00) from holding New Pacific Metals or give up 1.31% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.45%
Values	Daily Returns

Wallbox NV  vs.  New Pacific Metals

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 unfluctuating 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.

New Pacific Metals

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in New Pacific Metals are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Even with relatively conflicting basic indicators, New Pacific reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Wallbox NV and New Pacific

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

The idea behind Wallbox NV and New Pacific Metals 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.