Correlation Between Aim Investment and Gmo High
Can any of the company-specific risk be diversified away by investing in both Aim Investment and Gmo High 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 Aim Investment and Gmo High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aim Investment Secs and Gmo High Yield, you can compare the effects of market volatilities on Aim Investment and Gmo High 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 Aim Investment with a short position of Gmo High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aim Investment and Gmo High.
Diversification Opportunities for Aim Investment and Gmo High
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aim and GMO is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Aim Investment Secs and Gmo High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gmo High Yield and Aim Investment 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 Aim Investment Secs are associated (or correlated) with Gmo High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gmo High Yield has no effect on the direction of Aim Investment i.e., Aim Investment and Gmo High go up and down completely randomly.
Pair Corralation between Aim Investment and Gmo High
If you would invest 1,784 in Gmo High Yield on September 4, 2024 and sell it today you would earn a total of 25.00 from holding Gmo High Yield or generate 1.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aim Investment Secs vs. Gmo High Yield
Performance |
| Timeline |
| Aim Investment Secs |
| Gmo High Yield |
Aim Investment and Gmo High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aim Investment and Gmo High
The main advantage of trading using opposite Aim Investment and Gmo High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aim Investment position performs unexpectedly, Gmo High 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 Gmo High will offset losses from the drop in Gmo High's long position.| Aim Investment vs. Gmo High Yield | Aim Investment vs. Dreyfusstandish Global Fixed | Aim Investment vs. Federated Pennsylvania Municipal | Aim Investment vs. Lind Capital Partners |
| Gmo High vs. California High Yield Municipal | Gmo High vs. Siit High Yield | Gmo High vs. Pace High Yield |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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