Correlation Between 3M and Contextlogic Inc
Can any of the company-specific risk be diversified away by investing in both 3M and Contextlogic Inc 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 3M and Contextlogic Inc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 3M Company and Contextlogic, you can compare the effects of market volatilities on 3M and Contextlogic Inc 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 Contextlogic Inc. Check out your portfolio center. Please also check ongoing floating volatility patterns of 3M and Contextlogic Inc.
Diversification Opportunities for 3M and Contextlogic Inc
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 3M and Contextlogic Inc is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding 3M Company and Contextlogic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Contextlogic Inc 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 Contextlogic Inc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Contextlogic Inc has no effect on the direction of 3M i.e., 3M and Contextlogic Inc go up and down completely randomly.
Pair Corralation between 3M and Contextlogic Inc
Considering the 90-day investment horizon 3M Company is expected to generate 0.62 times more return on investment than Contextlogic Inc. However, 3M Company is 1.61 times less risky than Contextlogic Inc. It trades about 0.06 of its potential returns per unit of risk. Contextlogic is currently generating about 0.03 per unit of risk. If you would invest 12,720 in 3M Company on September 21, 2025 and sell it today you would earn a total of 3,476 from holding 3M Company or generate 27.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
3M Company vs. Contextlogic
Performance |
| Timeline |
| 3M Company |
| Contextlogic Inc |
3M and Contextlogic Inc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 3M and Contextlogic Inc
The main advantage of trading using opposite 3M and Contextlogic Inc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 3M position performs unexpectedly, Contextlogic Inc 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 Contextlogic Inc will offset losses from the drop in Contextlogic Inc's long position.The idea behind 3M Company and Contextlogic 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.| Contextlogic Inc vs. Baozun Inc | Contextlogic Inc vs. 1 800 FLOWERSCOM | Contextlogic Inc vs. ChargePoint Holdings | Contextlogic Inc vs. Studio City International |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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