Correlation Between Wallbox NV and PAR Technology

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

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

Diversification Opportunities for Wallbox NV and PAR Technology

0.25

Correlation Coefficient

Wallbox NV  PAR Technology

Modest diversification

The 3 months correlation between Wallbox and PAR is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Wallbox NV and PAR Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PAR Technology 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 PAR Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PAR Technology has no effect on the direction of Wallbox NV i.e., Wallbox NV and PAR Technology go up and down completely randomly.

Pair Corralation between Wallbox NV and PAR Technology

Considering the 90-day investment horizon Wallbox NV is expected to under-perform the PAR Technology. In addition to that, Wallbox NV is 1.85 times more volatile than PAR Technology. It trades about -0.15 of its total potential returns per unit of risk. PAR Technology is currently generating about -0.02 per unit of volatility. If you would invest  7,151  in PAR Technology on December 3, 2024 and sell it today you would lose (280.00) from holding PAR Technology or give up 3.92% of portfolio value over 90 days.

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

Wallbox NV  vs.  PAR Technology

Wallbox NV

Risk-Adjusted Performance

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 April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

PAR Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days PAR Technology has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest abnormal performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with Wallbox NV and PAR Technology

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

The idea behind Wallbox NV and PAR Technology 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.