Correlation Between Infinity Natural and WisdomTree Equity

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Can any of the company-specific risk be diversified away by investing in both Infinity Natural and WisdomTree Equity 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 Infinity Natural and WisdomTree Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Infinity Natural Resources and WisdomTree Equity Premium, you can compare the effects of market volatilities on Infinity Natural and WisdomTree Equity 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 Infinity Natural with a short position of WisdomTree Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Infinity Natural and WisdomTree Equity.

Diversification Opportunities for Infinity Natural and WisdomTree Equity

0.71
  Correlation Coefficient

Poor diversification

The 3 months correlation between Infinity and WisdomTree is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Infinity Natural Resources and WisdomTree Equity Premium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Equity Premium and Infinity Natural 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 Infinity Natural Resources are associated (or correlated) with WisdomTree Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Equity Premium has no effect on the direction of Infinity Natural i.e., Infinity Natural and WisdomTree Equity go up and down completely randomly.

Pair Corralation between Infinity Natural and WisdomTree Equity

Considering the 90-day investment horizon Infinity Natural Resources is expected to generate 4.73 times more return on investment than WisdomTree Equity. However, Infinity Natural is 4.73 times more volatile than WisdomTree Equity Premium. It trades about 0.11 of its potential returns per unit of risk. WisdomTree Equity Premium is currently generating about 0.09 per unit of risk. If you would invest  1,355  in Infinity Natural Resources on November 29, 2025 and sell it today you would earn a total of  241.00  from holding Infinity Natural Resources or generate 17.79% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Infinity Natural Resources  vs.  WisdomTree Equity Premium

 Performance 
       Timeline  
Infinity Natural Res 

Risk-Adjusted Performance

Fair

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Infinity Natural Resources are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Infinity Natural reported solid returns over the last few months and may actually be approaching a breakup point.
WisdomTree Equity Premium 

Risk-Adjusted Performance

Fair

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in WisdomTree Equity Premium are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong basic indicators, WisdomTree Equity is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Infinity Natural and WisdomTree Equity Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Infinity Natural and WisdomTree Equity

The main advantage of trading using opposite Infinity Natural and WisdomTree Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Infinity Natural position performs unexpectedly, WisdomTree Equity 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 Equity will offset losses from the drop in WisdomTree Equity's long position.
The idea behind Infinity Natural Resources and WisdomTree Equity Premium 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.
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.

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