Correlation Between AIM ETF and ProShares Short

Can any of the company-specific risk be diversified away by investing in both AIM ETF and ProShares Short 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 ProShares Short 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 ProShares Short Russell2000, you can compare the effects of market volatilities on AIM ETF and ProShares Short 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 ProShares Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of AIM ETF and ProShares Short.

Diversification Opportunities for AIM ETF and ProShares Short

-0.93

Correlation Coefficient

AIM ETF  ProShares Short

Pay attention - limited upside

The 3 months correlation between AIM and ProShares is -0.93. Overlapping area represents the amount of risk that can be diversified away by holding AIM ETF Products and ProShares Short Russell2000 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares Short Russ 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 ProShares Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares Short Russ has no effect on the direction of AIM ETF i.e., AIM ETF and ProShares Short go up and down completely randomly.

Pair Corralation between AIM ETF and ProShares Short

Given the investment horizon of 90 days AIM ETF Products is expected to generate 0.23 times more return on investment than ProShares Short. However, AIM ETF Products is 4.36 times less risky than ProShares Short. It trades about 0.27 of its potential returns per unit of risk. ProShares Short Russell2000 is currently generating about -0.11 per unit of risk. If you would invest  2,679  in AIM ETF Products on May 17, 2025 and sell it today you would earn a total of  117.00  from holding AIM ETF Products or generate 4.37% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	98.39%
Values	Daily Returns

AIM ETF Products  vs.  ProShares Short Russell2000

AIM ETF Products

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in AIM ETF Products are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, AIM ETF is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

ProShares Short Russ

Risk-Adjusted Performance

Weakest

Over the last 90 days ProShares Short Russell2000 has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Etf's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the ETF investors.

Pair Trading with AIM ETF and ProShares Short

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

The idea behind AIM ETF Products and ProShares Short Russell2000 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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.