Correlation Between Inepar SA and 3M
Can any of the company-specific risk be diversified away by investing in both Inepar SA and 3M 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 Inepar SA and 3M into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inepar SA Indstria and 3M Company, you can compare the effects of market volatilities on Inepar SA and 3M 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 Inepar SA with a short position of 3M. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inepar SA and 3M.
Diversification Opportunities for Inepar SA and 3M
Very good diversification
The 3 months correlation between Inepar and 3M is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Inepar SA Indstria and 3M Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 3M Company and Inepar SA 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 Inepar SA Indstria are associated (or correlated) with 3M. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 3M Company has no effect on the direction of Inepar SA i.e., Inepar SA and 3M go up and down completely randomly.
Pair Corralation between Inepar SA and 3M
Assuming the 90 days trading horizon Inepar SA Indstria is expected to under-perform the 3M. In addition to that, Inepar SA is 1.38 times more volatile than 3M Company. It trades about -0.13 of its total potential returns per unit of risk. 3M Company is currently generating about 0.09 per unit of volatility. If you would invest 11,923 in 3M Company on August 27, 2024 and sell it today you would earn a total of 6,754 from holding 3M Company or generate 56.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Inepar SA Indstria vs. 3M Company
Performance |
| Timeline |
| Inepar SA Indstria |
| 3M Company |
Inepar SA and 3M Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inepar SA and 3M
The main advantage of trading using opposite Inepar SA and 3M positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inepar SA position performs unexpectedly, 3M 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 3M will offset losses from the drop in 3M's long position.| Inepar SA vs. Inepar SA Indstria | Inepar SA vs. Lupatech SA | Inepar SA vs. Triunfo Participaes e | Inepar SA vs. Viver Incorporadora e |
| 3M vs. Zoom Video Communications | 3M vs. Paycom Software | 3M vs. Unifique Telecomunicaes SA | 3M vs. G2D Investments |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |