Correlation Between AIM ETF and IShares JP
Can any of the company-specific risk be diversified away by investing in both AIM ETF and IShares JP 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 JP 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 JP Morgan, you can compare the effects of market volatilities on AIM ETF and IShares JP 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 JP. Check out your portfolio center. Please also check ongoing floating volatility patterns of AIM ETF and IShares JP.
Diversification Opportunities for AIM ETF and IShares JP
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between AIM and IShares is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding AIM ETF Products and iShares JP Morgan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares JP Morgan 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 JP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares JP Morgan has no effect on the direction of AIM ETF i.e., AIM ETF and IShares JP go up and down completely randomly.
Pair Corralation between AIM ETF and IShares JP
Given the investment horizon of 90 days AIM ETF Products is expected to generate 0.38 times more return on investment than IShares JP. However, AIM ETF Products is 2.61 times less risky than IShares JP. It trades about 0.23 of its potential returns per unit of risk. iShares JP Morgan is currently generating about -0.05 per unit of risk. If you would invest 2,650 in AIM ETF Products on August 30, 2024 and sell it today you would earn a total of 30.00 from holding AIM ETF Products or generate 1.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AIM ETF Products vs. iShares JP Morgan
Performance |
| Timeline |
| AIM ETF Products |
| iShares JP Morgan |
AIM ETF and IShares JP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AIM ETF and IShares JP
The main advantage of trading using opposite AIM ETF and IShares JP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AIM ETF position performs unexpectedly, IShares JP 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 JP will offset losses from the drop in IShares JP'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 |
| IShares JP vs. Schwab Fundamental International | IShares JP vs. Xtrackers International Real | IShares JP vs. Schwab Fundamental Small | IShares JP vs. Schwab Fundamental Emerging |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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