Correlation Between Workiva and Diebold Nixdorf

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

By analyzing existing cross correlation between Workiva and Diebold Nixdorf Incorporated, you can compare the effects of market volatilities on Workiva and Diebold Nixdorf 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 Workiva with a short position of Diebold Nixdorf. Check out your portfolio center. Please also check ongoing floating volatility patterns of Workiva and Diebold Nixdorf.

Diversification Opportunities for Workiva and Diebold Nixdorf

-0.27

Correlation Coefficient

Workiva  Diebold Nixdorf

Very good diversification

The 3 months correlation between Workiva and Diebold is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Workiva and Diebold Nixdorf Incorporated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Diebold Nixdorf and Workiva 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 Workiva are associated (or correlated) with Diebold Nixdorf. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Diebold Nixdorf has no effect on the direction of Workiva i.e., Workiva and Diebold Nixdorf go up and down completely randomly.

Pair Corralation between Workiva and Diebold Nixdorf

Allowing for the 90-day total investment horizon Workiva is expected to generate 29.63 times less return on investment than Diebold Nixdorf. But when comparing it to its historical volatility, Workiva is 16.72 times less risky than Diebold Nixdorf. It trades about 0.03 of its potential returns per unit of risk. Diebold Nixdorf Incorporated is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  297.00  in Diebold Nixdorf Incorporated on February 8, 2024 and sell it today you would earn a total of  3,696  from holding Diebold Nixdorf Incorporated or generate 1244.44% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	97.58%
Values	Daily Returns

Workiva  vs.  Diebold Nixdorf Incorporated

Workiva

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Workiva has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's forward-looking signals remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Diebold Nixdorf

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Diebold Nixdorf Incorporated are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak fundamental drivers, Diebold Nixdorf exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Workiva and Diebold Nixdorf

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

The idea behind Workiva and Diebold Nixdorf Incorporated 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.