Correlation Between 3M and 26442CBC7
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By analyzing existing cross correlation between 3M Company and DUK 345 15 APR 51, you can compare the effects of market volatilities on 3M and 26442CBC7 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 26442CBC7. Check out your portfolio center. Please also check ongoing floating volatility patterns of 3M and 26442CBC7.
Diversification Opportunities for 3M and 26442CBC7
Average diversification
The 3 months correlation between 3M and 26442CBC7 is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding 3M Company and DUK 345 15 APR 51 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DUK 345 15 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 26442CBC7. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DUK 345 15 has no effect on the direction of 3M i.e., 3M and 26442CBC7 go up and down completely randomly.
Pair Corralation between 3M and 26442CBC7
Considering the 90-day investment horizon 3M Company is expected to generate 1.24 times more return on investment than 26442CBC7. However, 3M is 1.24 times more volatile than DUK 345 15 APR 51. It trades about 0.14 of its potential returns per unit of risk. DUK 345 15 APR 51 is currently generating about 0.07 per unit of risk. If you would invest 7,568 in 3M Company on August 27, 2024 and sell it today you would earn a total of 5,274 from holding 3M Company or generate 69.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 40.43% |
| Values | Daily Returns |
3M Company vs. DUK 345 15 APR 51
Performance |
| Timeline |
| 3M Company |
| DUK 345 15 |
3M and 26442CBC7 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 3M and 26442CBC7
The main advantage of trading using opposite 3M and 26442CBC7 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 3M position performs unexpectedly, 26442CBC7 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 26442CBC7 will offset losses from the drop in 26442CBC7's long position.| 3M vs. Vast Renewables Limited | 3M vs. 1847 Holdings LLC | 3M vs. Westport Fuel Systems | 3M vs. Brookfield Business Partners |
| 26442CBC7 vs. AEP TEX INC | 26442CBC7 vs. US BANK NATIONAL | 26442CBC7 vs. 3M Company | 26442CBC7 vs. Alcoa Corp |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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