Correlation Between WisdomTree Platinum and WisdomTree EURO
Can any of the company-specific risk be diversified away by investing in both WisdomTree Platinum and WisdomTree EURO 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 Platinum and WisdomTree EURO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WisdomTree Platinum 2x and WisdomTree EURO STOXX, you can compare the effects of market volatilities on WisdomTree Platinum and WisdomTree EURO 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 Platinum with a short position of WisdomTree EURO. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree Platinum and WisdomTree EURO.
Diversification Opportunities for WisdomTree Platinum and WisdomTree EURO
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between WisdomTree and WisdomTree is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree Platinum 2x and WisdomTree EURO STOXX in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree EURO STOXX and WisdomTree Platinum 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 Platinum 2x are associated (or correlated) with WisdomTree EURO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree EURO STOXX has no effect on the direction of WisdomTree Platinum i.e., WisdomTree Platinum and WisdomTree EURO go up and down completely randomly.
Pair Corralation between WisdomTree Platinum and WisdomTree EURO
Assuming the 90 days trading horizon WisdomTree Platinum is expected to generate 1.02 times less return on investment than WisdomTree EURO. But when comparing it to its historical volatility, WisdomTree Platinum 2x is 1.08 times less risky than WisdomTree EURO. It trades about 0.18 of its potential returns per unit of risk. WisdomTree EURO STOXX is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 100,475 in WisdomTree EURO STOXX on September 28, 2025 and sell it today you would earn a total of 436,325 from holding WisdomTree EURO STOXX or generate 434.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
WisdomTree Platinum 2x vs. WisdomTree EURO STOXX
Performance |
| Timeline |
| WisdomTree Platinum |
| WisdomTree EURO STOXX |
WisdomTree Platinum and WisdomTree EURO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree Platinum and WisdomTree EURO
The main advantage of trading using opposite WisdomTree Platinum and WisdomTree EURO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree Platinum position performs unexpectedly, WisdomTree EURO 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 EURO will offset losses from the drop in WisdomTree EURO's long position.| WisdomTree Platinum vs. WisdomTree NASDAQ 100 | WisdomTree Platinum vs. WisdomTree NASDAQ 100 | WisdomTree Platinum vs. WisdomTree Gold 3x | WisdomTree Platinum vs. WisdomTree Gold 3x |
| WisdomTree EURO vs. WisdomTree Zinc | WisdomTree EURO vs. WisdomTree Brent Crude | WisdomTree EURO vs. WisdomTree Aluminium 2x | WisdomTree EURO vs. WisdomTree Enhanced Commodity |
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.
Other Complementary Tools
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |