Correlation Between AIM ETF and VanEck Fallen
Can any of the company-specific risk be diversified away by investing in both AIM ETF and VanEck Fallen 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 ETF and VanEck Fallen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AIM ETF Products and VanEck Fallen Angel, you can compare the effects of market volatilities on AIM ETF and VanEck Fallen 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 ETF with a short position of VanEck Fallen. Check out your portfolio center. Please also check ongoing floating volatility patterns of AIM ETF and VanEck Fallen.
Diversification Opportunities for AIM ETF and VanEck Fallen
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between AIM and VanEck is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding AIM ETF Products and VanEck Fallen Angel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck Fallen Angel and AIM ETF 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 ETF Products are associated (or correlated) with VanEck Fallen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck Fallen Angel has no effect on the direction of AIM ETF i.e., AIM ETF and VanEck Fallen go up and down completely randomly.
Pair Corralation between AIM ETF and VanEck Fallen
Given the investment horizon of 90 days AIM ETF Products is expected to generate 1.12 times more return on investment than VanEck Fallen. However, AIM ETF is 1.12 times more volatile than VanEck Fallen Angel. It trades about 0.12 of its potential returns per unit of risk. VanEck Fallen Angel is currently generating about 0.11 per unit of risk. If you would invest 2,502 in AIM ETF Products on November 1, 2024 and sell it today you would earn a total of 201.00 from holding AIM ETF Products or generate 8.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 35.02% |
| Values | Daily Returns |
AIM ETF Products vs. VanEck Fallen Angel
Performance |
| Timeline |
| AIM ETF Products |
| VanEck Fallen Angel |
AIM ETF and VanEck Fallen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AIM ETF and VanEck Fallen
The main advantage of trading using opposite AIM ETF and VanEck Fallen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AIM ETF position performs unexpectedly, VanEck Fallen 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 VanEck Fallen will offset losses from the drop in VanEck Fallen's long position.| AIM ETF vs. FT Vest Equity | AIM ETF vs. Northern Lights | AIM ETF vs. Dimensional International High | AIM ETF vs. First Trust Exchange Traded |
| VanEck Fallen vs. iShares Fallen Angels | VanEck Fallen vs. VanEck Emerging Markets | VanEck Fallen vs. First Trust Multi Asset | VanEck Fallen vs. iShares 0 5 Year |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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