Correlation Between Innovator ETFs and AIM ETF
Can any of the company-specific risk be diversified away by investing in both Innovator ETFs 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 Innovator ETFs and AIM ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innovator ETFs Trust and AIM ETF Products, you can compare the effects of market volatilities on Innovator ETFs 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 Innovator ETFs with a short position of AIM ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innovator ETFs and AIM ETF.
Diversification Opportunities for Innovator ETFs and AIM ETF
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Innovator and AIM is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Innovator ETFs Trust 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 Innovator ETFs 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 Innovator ETFs Trust 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 Innovator ETFs i.e., Innovator ETFs and AIM ETF go up and down completely randomly.
Pair Corralation between Innovator ETFs and AIM ETF
Given the investment horizon of 90 days Innovator ETFs is expected to generate 1.63 times less return on investment than AIM ETF. But when comparing it to its historical volatility, Innovator ETFs Trust is 1.17 times less risky than AIM ETF. It trades about 0.1 of its potential returns per unit of risk. AIM ETF Products is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 2,564 in AIM ETF Products on September 3, 2024 and sell it today you would earn a total of 458.00 from holding AIM ETF Products or generate 17.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Innovator ETFs Trust vs. AIM ETF Products
Performance |
| Timeline |
| Innovator ETFs Trust |
| AIM ETF Products |
Innovator ETFs and AIM ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innovator ETFs and AIM ETF
The main advantage of trading using opposite Innovator ETFs and AIM ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innovator ETFs 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.| Innovator ETFs vs. ProShares Ultra MSCI | Innovator ETFs vs. ProShares UltraShort MSCI | Innovator ETFs vs. SWP Growth Income | Innovator ETFs vs. Invesco DB Dollar |
| AIM ETF vs. Innovator ETFs Trust | AIM ETF vs. First Trust Cboe | AIM ETF vs. FT Cboe Vest | AIM ETF vs. Innovator SP 500 |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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