Correlation Between Invesco Aerospace and Marimed

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

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

Diversification Opportunities for Invesco Aerospace and Marimed

0.53

Correlation Coefficient

Invesco Aerospace  Marimed

Very weak diversification

The 3 months correlation between Invesco and Marimed is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Invesco Aerospace Defense and Marimed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marimed and Invesco Aerospace 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 Aerospace Defense are associated (or correlated) with Marimed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marimed has no effect on the direction of Invesco Aerospace i.e., Invesco Aerospace and Marimed go up and down completely randomly.

Pair Corralation between Invesco Aerospace and Marimed

Considering the 90-day investment horizon Invesco Aerospace Defense is expected to generate 0.12 times more return on investment than Marimed. However, Invesco Aerospace Defense is 8.46 times less risky than Marimed. It trades about 0.33 of its potential returns per unit of risk. Marimed is currently generating about 0.03 per unit of risk. If you would invest  12,430  in Invesco Aerospace Defense on May 7, 2025 and sell it today you would earn a total of  2,264  from holding Invesco Aerospace Defense or generate 18.21% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Invesco Aerospace Defense  vs.  Marimed

Invesco Aerospace Defense

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Invesco Aerospace Defense are ranked lower than 25 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Invesco Aerospace sustained solid returns over the last few months and may actually be approaching a breakup point.

Marimed

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Marimed are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent primary indicators, Marimed exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Invesco Aerospace and Marimed

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

The idea behind Invesco Aerospace Defense and Marimed 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.