Correlation Between NYSE Composite and AIM ETF
Can any of the company-specific risk be diversified away by investing in both NYSE Composite 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 NYSE Composite and AIM ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and AIM ETF Products, you can compare the effects of market volatilities on NYSE Composite 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 NYSE Composite with a short position of AIM ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and AIM ETF.
Diversification Opportunities for NYSE Composite and AIM ETF
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between NYSE and AIM is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite 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 NYSE Composite 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 NYSE Composite 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 NYSE Composite i.e., NYSE Composite and AIM ETF go up and down completely randomly.
Pair Corralation between NYSE Composite and AIM ETF
Assuming the 90 days trading horizon NYSE Composite is expected to generate 1.35 times more return on investment than AIM ETF. However, NYSE Composite is 1.35 times more volatile than AIM ETF Products. It trades about 0.42 of its potential returns per unit of risk. AIM ETF Products is currently generating about 0.37 per unit of risk. If you would invest 1,923,895 in NYSE Composite on September 1, 2024 and sell it today you would earn a total of 103,309 from holding NYSE Composite or generate 5.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
NYSE Composite vs. AIM ETF Products
Performance |
| Timeline |
NYSE Composite and AIM ETF Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
AIM ETF Products
Pair trading matchups for AIM ETF
Pair Trading with NYSE Composite and AIM ETF
The main advantage of trading using opposite NYSE Composite and AIM ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite 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.| NYSE Composite vs. Acumen Pharmaceuticals | NYSE Composite vs. Mind Medicine | NYSE Composite vs. NL Industries | NYSE Composite vs. Ecovyst |
| AIM ETF vs. AIM ETF Products | AIM ETF vs. AIM ETF Products | AIM ETF vs. AllianzIM Large Cap | AIM ETF vs. AIM ETF Products |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |