Correlation Between 3M and BZLNZ
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By analyzing existing cross correlation between 3M Company and BZLNZ 1 03 MAR 26, you can compare the effects of market volatilities on 3M and BZLNZ 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 BZLNZ. Check out your portfolio center. Please also check ongoing floating volatility patterns of 3M and BZLNZ.
Diversification Opportunities for 3M and BZLNZ
Very good diversification
The 3 months correlation between 3M and BZLNZ is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding 3M Company and BZLNZ 1 03 MAR 26 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BZLNZ 1 03 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 BZLNZ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BZLNZ 1 03 has no effect on the direction of 3M i.e., 3M and BZLNZ go up and down completely randomly.
Pair Corralation between 3M and BZLNZ
Considering the 90-day investment horizon 3M Company is expected to generate 1.19 times more return on investment than BZLNZ. However, 3M is 1.19 times more volatile than BZLNZ 1 03 MAR 26. It trades about 0.1 of its potential returns per unit of risk. BZLNZ 1 03 MAR 26 is currently generating about -0.02 per unit of risk. If you would invest 8,359 in 3M Company on August 29, 2024 and sell it today you would earn a total of 4,936 from holding 3M Company or generate 59.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 27.82% |
| Values | Daily Returns |
3M Company vs. BZLNZ 1 03 MAR 26
Performance |
| Timeline |
| 3M Company |
| BZLNZ 1 03 |
3M and BZLNZ Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 3M and BZLNZ
The main advantage of trading using opposite 3M and BZLNZ positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 3M position performs unexpectedly, BZLNZ 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 BZLNZ will offset losses from the drop in BZLNZ's long position.| 3M vs. Vast Renewables Limited | 3M vs. 1847 Holdings LLC | 3M vs. Westport Fuel Systems | 3M vs. Brookfield Business Partners |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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