Correlation Between AllianzIM Large and AIM ETF
Can any of the company-specific risk be diversified away by investing in both AllianzIM Large and AIM ETF 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 AllianzIM Large and AIM ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AllianzIM Large Cap and AIM ETF Products, you can compare the effects of market volatilities on AllianzIM Large and AIM ETF 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 AllianzIM Large with a short position of AIM ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of AllianzIM Large and AIM ETF.
Diversification Opportunities for AllianzIM Large and AIM ETF
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between AllianzIM and AIM is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding AllianzIM Large Cap and AIM ETF Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AIM ETF Products and AllianzIM Large 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 AllianzIM Large Cap are associated (or correlated) with AIM ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AIM ETF Products has no effect on the direction of AllianzIM Large i.e., AllianzIM Large and AIM ETF go up and down completely randomly.
Pair Corralation between AllianzIM Large and AIM ETF
Given the investment horizon of 90 days AllianzIM Large Cap is expected to under-perform the AIM ETF. But the etf apears to be less risky and, when comparing its historical volatility, AllianzIM Large Cap is 1.24 times less risky than AIM ETF. The etf trades about -0.17 of its potential returns per unit of risk. The AIM ETF Products is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 3,315 in AIM ETF Products on January 10, 2025 and sell it today you would lose (111.00) from holding AIM ETF Products or give up 3.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
AllianzIM Large Cap vs. AIM ETF Products
Performance |
| Timeline |
| AllianzIM Large Cap |
| AIM ETF Products |
AllianzIM Large and AIM ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AllianzIM Large and AIM ETF
The main advantage of trading using opposite AllianzIM Large and AIM ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AllianzIM Large position performs unexpectedly, AIM ETF 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 AIM ETF will offset losses from the drop in AIM ETF's long position.The idea behind AllianzIM Large Cap and AIM ETF Products 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.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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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