Correlation Between 3M and 031162DF4
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By analyzing existing cross correlation between 3M Company and AMGN 42 22 FEB 52, you can compare the effects of market volatilities on 3M and 031162DF4 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 3M with a short position of 031162DF4. Check out your portfolio center. Please also check ongoing floating volatility patterns of 3M and 031162DF4.
Diversification Opportunities for 3M and 031162DF4
Very weak diversification
The 3 months correlation between 3M and 031162DF4 is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding 3M Company and AMGN 42 22 FEB 52 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMGN 42 22 and 3M 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 3M Company are associated (or correlated) with 031162DF4. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMGN 42 22 has no effect on the direction of 3M i.e., 3M and 031162DF4 go up and down completely randomly.
Pair Corralation between 3M and 031162DF4
Considering the 90-day investment horizon 3M Company is expected to generate 1.78 times more return on investment than 031162DF4. However, 3M is 1.78 times more volatile than AMGN 42 22 FEB 52. It trades about 0.09 of its potential returns per unit of risk. AMGN 42 22 FEB 52 is currently generating about 0.03 per unit of risk. If you would invest 12,409 in 3M Company on August 26, 2024 and sell it today you would earn a total of 433.00 from holding 3M Company or generate 3.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
3M Company vs. AMGN 42 22 FEB 52
Performance |
| Timeline |
| 3M Company |
| AMGN 42 22 |
3M and 031162DF4 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 3M and 031162DF4
The main advantage of trading using opposite 3M and 031162DF4 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 3M position performs unexpectedly, 031162DF4 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 031162DF4 will offset losses from the drop in 031162DF4's long position.| 3M vs. Vast Renewables Limited | 3M vs. 1847 Holdings LLC | 3M vs. Westport Fuel Systems | 3M vs. Brookfield Business Partners |
| 031162DF4 vs. Playtika Holding Corp | 031162DF4 vs. Hasbro Inc | 031162DF4 vs. Boston Beer | 031162DF4 vs. Fevertree Drinks Plc |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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