Correlation Between Rush Street and AIM ETF
Can any of the company-specific risk be diversified away by investing in both Rush Street 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 Rush Street and AIM ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rush Street Interactive and AIM ETF Products, you can compare the effects of market volatilities on Rush Street 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 Rush Street with a short position of AIM ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rush Street and AIM ETF.
Diversification Opportunities for Rush Street and AIM ETF
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Rush and AIM is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Rush Street Interactive 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 Rush Street 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 Rush Street Interactive 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 Rush Street i.e., Rush Street and AIM ETF go up and down completely randomly.
Pair Corralation between Rush Street and AIM ETF
Considering the 90-day investment horizon Rush Street Interactive is expected to generate 32.71 times more return on investment than AIM ETF. However, Rush Street is 32.71 times more volatile than AIM ETF Products. It trades about 0.41 of its potential returns per unit of risk. AIM ETF Products is currently generating about 0.31 per unit of risk. If you would invest 1,040 in Rush Street Interactive on August 28, 2024 and sell it today you would earn a total of 411.00 from holding Rush Street Interactive or generate 39.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rush Street Interactive vs. AIM ETF Products
Performance |
| Timeline |
| Rush Street Interactive |
| AIM ETF Products |
Rush Street and AIM ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rush Street and AIM ETF
The main advantage of trading using opposite Rush Street and AIM ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rush Street 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.| Rush Street vs. Genius Sports | Rush Street vs. Gan | Rush Street vs. Ballys Corp | Rush Street vs. Hims Hers Health |
| AIM ETF vs. FT Vest Equity | AIM ETF vs. Northern Lights | AIM ETF vs. Dimensional International High | AIM ETF vs. First Trust Exchange Traded |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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