Correlation Between AIM ETF and AdvisorShares
Can any of the company-specific risk be diversified away by investing in both AIM ETF and AdvisorShares 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 AdvisorShares 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 AdvisorShares, you can compare the effects of market volatilities on AIM ETF and AdvisorShares 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 AdvisorShares. Check out your portfolio center. Please also check ongoing floating volatility patterns of AIM ETF and AdvisorShares.
Diversification Opportunities for AIM ETF and AdvisorShares
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between AIM and AdvisorShares is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding AIM ETF Products and AdvisorShares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AdvisorShares 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 AdvisorShares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AdvisorShares has no effect on the direction of AIM ETF i.e., AIM ETF and AdvisorShares go up and down completely randomly.
Pair Corralation between AIM ETF and AdvisorShares
If you would invest 2,939 in AIM ETF Products on September 1, 2024 and sell it today you would earn a total of 83.00 from holding AIM ETF Products or generate 2.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 4.55% |
| Values | Daily Returns |
AIM ETF Products vs. AdvisorShares
Performance |
| Timeline |
| AIM ETF Products |
| AdvisorShares |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
AIM ETF and AdvisorShares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AIM ETF and AdvisorShares
The main advantage of trading using opposite AIM ETF and AdvisorShares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AIM ETF position performs unexpectedly, AdvisorShares 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 AdvisorShares will offset losses from the drop in AdvisorShares' long position.| AIM ETF vs. AIM ETF Products | AIM ETF vs. First Trust Exchange Traded | AIM ETF vs. Innovator ETFs Trust | AIM ETF vs. Innovator ETFs Trust |
| AdvisorShares vs. First Trust Managed | AdvisorShares vs. IQ Hedge Multi Strategy | AdvisorShares vs. First Trust BuyWrite | AdvisorShares vs. SPDR SSgA Global |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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