Correlation Between CoinShares Physical and WisdomTree Ethereum
Can any of the company-specific risk be diversified away by investing in both CoinShares Physical and WisdomTree Ethereum 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 CoinShares Physical and WisdomTree Ethereum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CoinShares Physical Bitcoin and WisdomTree Ethereum ETC, you can compare the effects of market volatilities on CoinShares Physical and WisdomTree Ethereum 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 CoinShares Physical with a short position of WisdomTree Ethereum. Check out your portfolio center. Please also check ongoing floating volatility patterns of CoinShares Physical and WisdomTree Ethereum.
Diversification Opportunities for CoinShares Physical and WisdomTree Ethereum
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between CoinShares and WisdomTree is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding CoinShares Physical Bitcoin and WisdomTree Ethereum ETC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Ethereum ETC and CoinShares Physical 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 CoinShares Physical Bitcoin are associated (or correlated) with WisdomTree Ethereum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Ethereum ETC has no effect on the direction of CoinShares Physical i.e., CoinShares Physical and WisdomTree Ethereum go up and down completely randomly.
Pair Corralation between CoinShares Physical and WisdomTree Ethereum
Assuming the 90 days trading horizon CoinShares Physical Bitcoin is expected to generate 0.72 times more return on investment than WisdomTree Ethereum. However, CoinShares Physical Bitcoin is 1.4 times less risky than WisdomTree Ethereum. It trades about -0.13 of its potential returns per unit of risk. WisdomTree Ethereum ETC is currently generating about -0.14 per unit of risk. If you would invest 7,547 in CoinShares Physical Bitcoin on November 6, 2025 and sell it today you would lose (1,727) from holding CoinShares Physical Bitcoin or give up 22.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
CoinShares Physical Bitcoin vs. WisdomTree Ethereum ETC
Performance |
| Timeline |
| CoinShares Physical |
| WisdomTree Ethereum ETC |
CoinShares Physical and WisdomTree Ethereum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CoinShares Physical and WisdomTree Ethereum
The main advantage of trading using opposite CoinShares Physical and WisdomTree Ethereum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CoinShares Physical position performs unexpectedly, WisdomTree Ethereum 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 Ethereum will offset losses from the drop in WisdomTree Ethereum's long position.The idea behind CoinShares Physical Bitcoin and WisdomTree Ethereum ETC 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.
| WisdomTree Ethereum vs. SPDR MSCI Europe | WisdomTree Ethereum vs. iShares Swiss Domestic | WisdomTree Ethereum vs. iShares MSCI Japan | WisdomTree Ethereum vs. iShares Corp Bond |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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