Correlation Between Invesco Municipal and Aim Taxexempt
Can any of the company-specific risk be diversified away by investing in both Invesco Municipal and Aim Taxexempt 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 Invesco Municipal and Aim Taxexempt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invesco Municipal Income and Aim Taxexempt Funds, you can compare the effects of market volatilities on Invesco Municipal and Aim Taxexempt 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 Invesco Municipal with a short position of Aim Taxexempt. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco Municipal and Aim Taxexempt.
Diversification Opportunities for Invesco Municipal and Aim Taxexempt
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Invesco and Aim is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Invesco Municipal Income and Aim Taxexempt Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aim Taxexempt Funds and Invesco Municipal 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 Invesco Municipal Income are associated (or correlated) with Aim Taxexempt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aim Taxexempt Funds has no effect on the direction of Invesco Municipal i.e., Invesco Municipal and Aim Taxexempt go up and down completely randomly.
Pair Corralation between Invesco Municipal and Aim Taxexempt
Assuming the 90 days horizon Invesco Municipal Income is expected to generate 1.4 times more return on investment than Aim Taxexempt. However, Invesco Municipal is 1.4 times more volatile than Aim Taxexempt Funds. It trades about 0.13 of its potential returns per unit of risk. Aim Taxexempt Funds is currently generating about 0.15 per unit of risk. If you would invest 1,168 in Invesco Municipal Income on September 1, 2024 and sell it today you would earn a total of 49.00 from holding Invesco Municipal Income or generate 4.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.21% |
| Values | Daily Returns |
Invesco Municipal Income vs. Aim Taxexempt Funds
Performance |
| Timeline |
| Invesco Municipal Income |
| Aim Taxexempt Funds |
Invesco Municipal and Aim Taxexempt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invesco Municipal and Aim Taxexempt
The main advantage of trading using opposite Invesco Municipal and Aim Taxexempt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco Municipal position performs unexpectedly, Aim Taxexempt 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 Aim Taxexempt will offset losses from the drop in Aim Taxexempt's long position.| Invesco Municipal vs. Harbor Diversified International | Invesco Municipal vs. Fidelity Advisor Diversified | Invesco Municipal vs. Small Cap Stock | Invesco Municipal vs. Adams Diversified Equity |
| Aim Taxexempt vs. Invesco Municipal Income | Aim Taxexempt vs. Invesco Municipal Income | Aim Taxexempt vs. Invesco Municipal Income | Aim Taxexempt vs. Oppenheimer Rising Dividends |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |