Correlation Between 3M and Pgim Securitized
Can any of the company-specific risk be diversified away by investing in both 3M and Pgim Securitized 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 Pgim Securitized into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 3M Company and Pgim Securitized Credit, you can compare the effects of market volatilities on 3M and Pgim Securitized 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 Pgim Securitized. Check out your portfolio center. Please also check ongoing floating volatility patterns of 3M and Pgim Securitized.
Diversification Opportunities for 3M and Pgim Securitized
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 3M and Pgim is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding 3M Company and Pgim Securitized Credit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pgim Securitized Credit 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 Pgim Securitized. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pgim Securitized Credit has no effect on the direction of 3M i.e., 3M and Pgim Securitized go up and down completely randomly.
Pair Corralation between 3M and Pgim Securitized
Considering the 90-day investment horizon 3M Company is expected to generate 17.07 times more return on investment than Pgim Securitized. However, 3M is 17.07 times more volatile than Pgim Securitized Credit. It trades about 0.07 of its potential returns per unit of risk. Pgim Securitized Credit is currently generating about 0.23 per unit of risk. If you would invest 14,767 in 3M Company on May 30, 2025 and sell it today you would earn a total of 886.00 from holding 3M Company or generate 6.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
3M Company vs. Pgim Securitized Credit
Performance |
| Timeline |
| 3M Company |
| Pgim Securitized Credit |
3M and Pgim Securitized Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 3M and Pgim Securitized
The main advantage of trading using opposite 3M and Pgim Securitized positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 3M position performs unexpectedly, Pgim Securitized 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 Pgim Securitized will offset losses from the drop in Pgim Securitized's long position.| 3M vs. Skycorp Solar Group | 3M vs. Elong Power Holding | 3M vs. Westport Fuel Systems | 3M vs. Falcons Beyond Global, |
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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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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