Correlation Between APPTECH CORP and 3M

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Can any of the company-specific risk be diversified away by investing in both APPTECH CORP and 3M 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 APPTECH CORP and 3M into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between APPTECH CORP and 3M Company, you can compare the effects of market volatilities on APPTECH CORP and 3M 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 APPTECH CORP with a short position of 3M. Check out your portfolio center. Please also check ongoing floating volatility patterns of APPTECH CORP and 3M.

Diversification Opportunities for APPTECH CORP and 3M

0.52
  Correlation Coefficient

Very weak diversification

The 3 months correlation between APPTECH and 3M is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding APPTECH CORP and 3M Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 3M Company and APPTECH CORP 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 APPTECH CORP are associated (or correlated) with 3M. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 3M Company has no effect on the direction of APPTECH CORP i.e., APPTECH CORP and 3M go up and down completely randomly.

Pair Corralation between APPTECH CORP and 3M

Given the investment horizon of 90 days APPTECH CORP is expected to generate 8.73 times more return on investment than 3M. However, APPTECH CORP is 8.73 times more volatile than 3M Company. It trades about 0.05 of its potential returns per unit of risk. 3M Company is currently generating about -0.04 per unit of risk. If you would invest  125.00  in APPTECH CORP on June 28, 2022 and sell it today you would lose (61.00)  from holding APPTECH CORP or give up 48.8% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

APPTECH CORP  vs.  3M Company

 Performance (%) 
       Timeline  
APPTECH CORP 
APPTECH Performance
2 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in APPTECH CORP are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak fundamental indicators, APPTECH CORP may actually be approaching a critical reversion point that can send shares even higher in October 2022.

APPTECH Price Channel

3M Company 
3M Performance
0 of 100
Over the last 90 days 3M Company has generated negative risk-adjusted returns adding no value to investors with long positions. Even with abnormal performance in the last few months, the Stock's primary indicators remain relatively steady which may send shares a bit higher in October 2022. The new chaos may also be a sign of medium-term up-swing for the company stakeholders.

3M Price Channel

APPTECH CORP and 3M Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with APPTECH CORP and 3M

The main advantage of trading using opposite APPTECH CORP and 3M positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if APPTECH CORP position performs unexpectedly, 3M 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 3M will offset losses from the drop in 3M's long position.
APPTECH CORP vs. Kibush Capital Corp
The idea behind APPTECH CORP and 3M Company 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.
3M vs. Clearwater Paper 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.

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