Correlation Between AIM ETF and IShares Core
Can any of the company-specific risk be diversified away by investing in both AIM ETF and IShares Core 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 IShares Core 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 iShares Core MSCI, you can compare the effects of market volatilities on AIM ETF and IShares Core 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 IShares Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of AIM ETF and IShares Core.
Diversification Opportunities for AIM ETF and IShares Core
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between AIM and IShares is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding AIM ETF Products and iShares Core MSCI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Core MSCI 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 IShares Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Core MSCI has no effect on the direction of AIM ETF i.e., AIM ETF and IShares Core go up and down completely randomly.
Pair Corralation between AIM ETF and IShares Core
Given the investment horizon of 90 days AIM ETF Products is expected to generate 86.68 times more return on investment than IShares Core. However, AIM ETF is 86.68 times more volatile than iShares Core MSCI. It trades about 0.08 of its potential returns per unit of risk. iShares Core MSCI is currently generating about 0.05 per unit of risk. If you would invest 0.01 in AIM ETF Products on September 4, 2024 and sell it today you would earn a total of 2,686 from holding AIM ETF Products or generate 2.68599E7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 34.14% |
| Values | Daily Returns |
AIM ETF Products vs. iShares Core MSCI
Performance |
| Timeline |
| AIM ETF Products |
| iShares Core MSCI |
AIM ETF and IShares Core Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AIM ETF and IShares Core
The main advantage of trading using opposite AIM ETF and IShares Core positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AIM ETF position performs unexpectedly, IShares Core 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 IShares Core will offset losses from the drop in IShares Core's long position.| AIM ETF vs. Innovator ETFs Trust | AIM ETF vs. First Trust Cboe | AIM ETF vs. Innovator SP 500 | AIM ETF vs. FT Cboe Vest |
| IShares Core vs. iShares Core MSCI | IShares Core vs. iShares Core MSCI | IShares Core vs. iShares MSCI Europe | IShares Core vs. iShares Currency Hedged |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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