Correlation Between IShares Gold and USCF Gold
Can any of the company-specific risk be diversified away by investing in both IShares Gold and USCF Gold 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 USCF Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Gold Trust and USCF Gold Strategy, you can compare the effects of market volatilities on IShares Gold and USCF Gold 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 USCF Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Gold and USCF Gold.
Diversification Opportunities for IShares Gold and USCF Gold
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between IShares and USCF is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding iShares Gold Trust and USCF Gold Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on USCF Gold Strategy 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 Trust are associated (or correlated) with USCF Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of USCF Gold Strategy has no effect on the direction of IShares Gold i.e., IShares Gold and USCF Gold go up and down completely randomly.
Pair Corralation between IShares Gold and USCF Gold
If you would invest 3,017 in USCF Gold Strategy on August 27, 2024 and sell it today you would earn a total of 0.00 from holding USCF Gold Strategy or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.76% |
| Values | Daily Returns |
iShares Gold Trust vs. USCF Gold Strategy
Performance |
| Timeline |
| iShares Gold Trust |
| USCF Gold Strategy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
IShares Gold and USCF Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Gold and USCF Gold
The main advantage of trading using opposite IShares Gold and USCF Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Gold position performs unexpectedly, USCF Gold 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 USCF Gold will offset losses from the drop in USCF Gold's long position.| IShares Gold vs. Aquagold International | IShares Gold vs. Morningstar Unconstrained Allocation | IShares Gold vs. High Yield Municipal Fund | IShares Gold vs. Thrivent High Yield |
| USCF Gold vs. iShares MSCI Global | USCF Gold vs. Global X Silver | USCF Gold vs. VanEck Junior Gold | USCF Gold vs. Sprott Gold Miners |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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