Correlation Between Wallbox NV and Sanmina

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

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

Diversification Opportunities for Wallbox NV and Sanmina

-0.78

Correlation Coefficient

Wallbox NV  Sanmina

Pay attention - limited upside

The 3 months correlation between Wallbox and Sanmina is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Wallbox NV and Sanmina in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sanmina 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 Sanmina. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sanmina has no effect on the direction of Wallbox NV i.e., Wallbox NV and Sanmina go up and down completely randomly.

Pair Corralation between Wallbox NV and Sanmina

Considering the 90-day investment horizon Wallbox NV is expected to under-perform the Sanmina. In addition to that, Wallbox NV is 5.64 times more volatile than Sanmina. It trades about -0.14 of its total potential returns per unit of risk. Sanmina is currently generating about -0.04 per unit of volatility. If you would invest  7,758  in Sanmina on September 21, 2024 and sell it today you would lose (70.00) from holding Sanmina or give up 0.9% of portfolio value over 90 days.

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

Wallbox NV  vs.  Sanmina

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.

Sanmina

Risk-Adjusted Performance

7 of 100

OK

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

Pair Trading with Wallbox NV and Sanmina

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

The idea behind Wallbox NV and Sanmina 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.

Check out your portfolio center.

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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.