Correlation Between IShares Gold and WisdomTree Emerging
Can any of the company-specific risk be diversified away by investing in both IShares Gold and WisdomTree Emerging 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 IShares Gold and WisdomTree Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Gold ETF and WisdomTree Emerging Markets, you can compare the effects of market volatilities on IShares Gold and WisdomTree Emerging 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 IShares Gold with a short position of WisdomTree Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Gold and WisdomTree Emerging.
Diversification Opportunities for IShares Gold and WisdomTree Emerging
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between IShares and WisdomTree is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding iShares Gold ETF and WisdomTree Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Emerging and IShares 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 iShares Gold ETF are associated (or correlated) with WisdomTree Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Emerging has no effect on the direction of IShares Gold i.e., IShares Gold and WisdomTree Emerging go up and down completely randomly.
Pair Corralation between IShares Gold and WisdomTree Emerging
Assuming the 90 days trading horizon iShares Gold ETF is expected to generate 0.51 times more return on investment than WisdomTree Emerging. However, iShares Gold ETF is 1.96 times less risky than WisdomTree Emerging. It trades about 0.2 of its potential returns per unit of risk. WisdomTree Emerging Markets is currently generating about 0.02 per unit of risk. If you would invest 26,295 in iShares Gold ETF on October 22, 2025 and sell it today you would earn a total of 19,100 from holding iShares Gold ETF or generate 72.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Gold ETF vs. WisdomTree Emerging Markets
Performance |
| Timeline |
| iShares Gold ETF |
| WisdomTree Emerging |
IShares Gold and WisdomTree Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Gold and WisdomTree Emerging
The main advantage of trading using opposite IShares Gold and WisdomTree Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Gold position performs unexpectedly, WisdomTree Emerging 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 Emerging will offset losses from the drop in WisdomTree Emerging's long position.| IShares Gold vs. iShares MSCI AC | IShares Gold vs. iShares Global Inflation | IShares Gold vs. iShares Corp Bond | IShares Gold vs. iShares MSCI World |
| WisdomTree Emerging vs. iShares MSCI AC | WisdomTree Emerging vs. iShares Global Inflation | WisdomTree Emerging vs. iShares Gold ETF | WisdomTree Emerging 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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