Correlation Between WisdomTree Gold and WisdomTree Physical
Can any of the company-specific risk be diversified away by investing in both WisdomTree Gold and WisdomTree Physical 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 Physical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WisdomTree Gold EUR and WisdomTree Physical Bitcoin, you can compare the effects of market volatilities on WisdomTree Gold and WisdomTree Physical 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 Physical. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree Gold and WisdomTree Physical.
Diversification Opportunities for WisdomTree Gold and WisdomTree Physical
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between WisdomTree and WisdomTree is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree Gold EUR and WisdomTree Physical Bitcoin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Physical 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 EUR are associated (or correlated) with WisdomTree Physical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Physical has no effect on the direction of WisdomTree Gold i.e., WisdomTree Gold and WisdomTree Physical go up and down completely randomly.
Pair Corralation between WisdomTree Gold and WisdomTree Physical
Assuming the 90 days trading horizon WisdomTree Gold EUR is expected to generate 0.73 times more return on investment than WisdomTree Physical. However, WisdomTree Gold EUR is 1.37 times less risky than WisdomTree Physical. It trades about 0.23 of its potential returns per unit of risk. WisdomTree Physical Bitcoin is currently generating about 0.14 per unit of risk. If you would invest 3,771 in WisdomTree Gold EUR on October 22, 2025 and sell it today you would earn a total of 217.00 from holding WisdomTree Gold EUR or generate 5.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
WisdomTree Gold EUR vs. WisdomTree Physical Bitcoin
Performance |
| Timeline |
| WisdomTree Gold EUR |
| WisdomTree Physical |
WisdomTree Gold and WisdomTree Physical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree Gold and WisdomTree Physical
The main advantage of trading using opposite WisdomTree Gold and WisdomTree Physical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree Gold position performs unexpectedly, WisdomTree Physical 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 Physical will offset losses from the drop in WisdomTree Physical's long position.| WisdomTree Gold vs. WisdomTree Wheat EUR | WisdomTree Gold vs. WisdomTree Physical Bitcoin | WisdomTree Gold vs. WisdomTree Physical Cardano | WisdomTree Gold vs. WisdomTree Physical Polkadot |
| WisdomTree Physical vs. WisdomTree Wheat EUR | WisdomTree Physical vs. WisdomTree Gold EUR | WisdomTree Physical vs. WisdomTree Physical Cardano | WisdomTree Physical vs. WisdomTree Physical Polkadot |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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