Correlation Between Element Fleet and Aimia Pref

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

By analyzing existing cross correlation between Element Fleet Management and Aimia Pref C, you can compare the effects of market volatilities on Element Fleet and Aimia Pref 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 Element Fleet with a short position of Aimia Pref. Check out your portfolio center. Please also check ongoing floating volatility patterns of Element Fleet and Aimia Pref.

Diversification Opportunities for Element Fleet and Aimia Pref

0.9

Correlation Coefficient

Element Fleet  Aimia Pref

Almost no diversification

The 3 months correlation between Element and Aimia is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Element Fleet Management and Aimia Pref C in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aimia Pref C and Element Fleet 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 Element Fleet Management are associated (or correlated) with Aimia Pref. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aimia Pref C has no effect on the direction of Element Fleet i.e., Element Fleet and Aimia Pref go up and down completely randomly.

Pair Corralation between Element Fleet and Aimia Pref

Assuming the 90 days trading horizon Element Fleet is expected to generate 1.14 times less return on investment than Aimia Pref. In addition to that, Element Fleet is 1.18 times more volatile than Aimia Pref C. It trades about 0.27 of its total potential returns per unit of risk. Aimia Pref C is currently generating about 0.36 per unit of volatility. If you would invest  1,675  in Aimia Pref C on April 24, 2025 and sell it today you would earn a total of  330.00  from holding Aimia Pref C or generate 19.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	98.41%
Values	Daily Returns

Element Fleet Management  vs.  Aimia Pref C

Element Fleet Management

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Element Fleet Management are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Element Fleet displayed solid returns over the last few months and may actually be approaching a breakup point.

Aimia Pref C

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Aimia Pref C are ranked lower than 28 (%) of all global equities and portfolios over the last 90 days. Despite somewhat fragile primary indicators, Aimia Pref sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Element Fleet and Aimia Pref

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

The idea behind Element Fleet Management and Aimia Pref C 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.

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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.