Correlation Between Ameriprise Financial and AIM ImmunoTech

Can any of the company-specific risk be diversified away by investing in both Ameriprise Financial and AIM ImmunoTech 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 Ameriprise Financial and AIM ImmunoTech into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ameriprise Financial and AIM ImmunoTech, you can compare the effects of market volatilities on Ameriprise Financial and AIM ImmunoTech 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 Ameriprise Financial with a short position of AIM ImmunoTech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ameriprise Financial and AIM ImmunoTech.

Diversification Opportunities for Ameriprise Financial and AIM ImmunoTech

-0.5

Correlation Coefficient

Ameriprise Financial  AIM ImmunoTech

Very good diversification

The 3 months correlation between Ameriprise and AIM is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Ameriprise Financial and AIM ImmunoTech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AIM ImmunoTech and Ameriprise Financial 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 Ameriprise Financial are associated (or correlated) with AIM ImmunoTech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AIM ImmunoTech has no effect on the direction of Ameriprise Financial i.e., Ameriprise Financial and AIM ImmunoTech go up and down completely randomly.

Pair Corralation between Ameriprise Financial and AIM ImmunoTech

Assuming the 90 days trading horizon Ameriprise Financial is expected to under-perform the AIM ImmunoTech. But the stock apears to be less risky and, when comparing its historical volatility, Ameriprise Financial is 4.29 times less risky than AIM ImmunoTech. The stock trades about -0.04 of its potential returns per unit of risk. The AIM ImmunoTech is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  22.00  in AIM ImmunoTech on October 25, 2024 and sell it today you would earn a total of  1.00  from holding AIM ImmunoTech or generate 4.55% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	87.8%
Values	Daily Returns

Ameriprise Financial  vs.  AIM ImmunoTech

Ameriprise Financial

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Ameriprise Financial are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Ameriprise Financial unveiled solid returns over the last few months and may actually be approaching a breakup point.

AIM ImmunoTech

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AIM ImmunoTech has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, AIM ImmunoTech is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Ameriprise Financial and AIM ImmunoTech

The main advantage of trading using opposite Ameriprise Financial and AIM ImmunoTech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ameriprise Financial position performs unexpectedly, AIM ImmunoTech 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 ImmunoTech will offset losses from the drop in AIM ImmunoTech's long position.

The idea behind Ameriprise Financial and AIM ImmunoTech pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.