Correlation Between AIM ETF and Vesper Large
Can any of the company-specific risk be diversified away by investing in both AIM ETF and Vesper Large 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 Vesper Large 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 Vesper Large Cap, you can compare the effects of market volatilities on AIM ETF and Vesper Large 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 Vesper Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of AIM ETF and Vesper Large.
Diversification Opportunities for AIM ETF and Vesper Large
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between AIM and Vesper is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding AIM ETF Products and Vesper Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vesper Large Cap 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 Vesper Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vesper Large Cap has no effect on the direction of AIM ETF i.e., AIM ETF and Vesper Large go up and down completely randomly.
Pair Corralation between AIM ETF and Vesper Large
Given the investment horizon of 90 days AIM ETF is expected to generate 2.91 times less return on investment than Vesper Large. But when comparing it to its historical volatility, AIM ETF Products is 3.8 times less risky than Vesper Large. It trades about 0.51 of its potential returns per unit of risk. Vesper Large Cap is currently generating about 0.4 of returns per unit of risk over similar time horizon. If you would invest 3,058 in Vesper Large Cap on September 1, 2024 and sell it today you would earn a total of 183.00 from holding Vesper Large Cap or generate 5.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
AIM ETF Products vs. Vesper Large Cap
Performance |
| Timeline |
| AIM ETF Products |
| Vesper Large Cap |
AIM ETF and Vesper Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AIM ETF and Vesper Large
The main advantage of trading using opposite AIM ETF and Vesper Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AIM ETF position performs unexpectedly, Vesper Large 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 Vesper Large will offset losses from the drop in Vesper Large's long position.| AIM ETF vs. FT Vest Equity | AIM ETF vs. Northern Lights | AIM ETF vs. Dimensional International High | AIM ETF vs. Matthews China Discovery |
| Vesper Large vs. Vanguard Total Stock | Vesper Large vs. SPDR SP 500 | Vesper Large vs. iShares Core SP | Vesper Large vs. Vanguard Dividend Appreciation |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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