Correlation Between WisdomTree Gold and WisdomTree Aluminium
Can any of the company-specific risk be diversified away by investing in both WisdomTree Gold and WisdomTree Aluminium 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 WisdomTree Gold and WisdomTree Aluminium into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WisdomTree Gold 3x and WisdomTree Aluminium, you can compare the effects of market volatilities on WisdomTree Gold and WisdomTree Aluminium 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 WisdomTree Gold with a short position of WisdomTree Aluminium. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree Gold and WisdomTree Aluminium.
Diversification Opportunities for WisdomTree Gold and WisdomTree Aluminium
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between WisdomTree and WisdomTree is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree Gold 3x and WisdomTree Aluminium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Aluminium and WisdomTree Gold 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 WisdomTree Gold 3x are associated (or correlated) with WisdomTree Aluminium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Aluminium has no effect on the direction of WisdomTree Gold i.e., WisdomTree Gold and WisdomTree Aluminium go up and down completely randomly.
Pair Corralation between WisdomTree Gold and WisdomTree Aluminium
Assuming the 90 days trading horizon WisdomTree Gold 3x is expected to generate 5.24 times more return on investment than WisdomTree Aluminium. However, WisdomTree Gold is 5.24 times more volatile than WisdomTree Aluminium. It trades about 0.18 of its potential returns per unit of risk. WisdomTree Aluminium is currently generating about 0.11 per unit of risk. If you would invest 16,404 in WisdomTree Gold 3x on November 5, 2025 and sell it today you would earn a total of 11,238 from holding WisdomTree Gold 3x or generate 68.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
WisdomTree Gold 3x vs. WisdomTree Aluminium
Performance |
| Timeline |
| WisdomTree Gold 3x |
| WisdomTree Aluminium |
WisdomTree Gold and WisdomTree Aluminium Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree Gold and WisdomTree Aluminium
The main advantage of trading using opposite WisdomTree Gold and WisdomTree Aluminium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree Gold position performs unexpectedly, WisdomTree Aluminium 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 WisdomTree Aluminium will offset losses from the drop in WisdomTree Aluminium's long position.| WisdomTree Gold vs. WisdomTree Zinc | WisdomTree Gold vs. WisdomTree Brent Crude | WisdomTree Gold vs. WisdomTree Aluminium 2x | WisdomTree Gold vs. WisdomTree Enhanced Commodity |
| WisdomTree Aluminium vs. WisdomTree Zinc | WisdomTree Aluminium vs. WisdomTree Brent Crude | WisdomTree Aluminium vs. WisdomTree Aluminium 2x | WisdomTree Aluminium vs. WisdomTree Enhanced Commodity |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |