Correlation Between WisdomTree Platinum and WisdomTree NASDAQ
Can any of the company-specific risk be diversified away by investing in both WisdomTree Platinum and WisdomTree NASDAQ 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 NASDAQ 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 NASDAQ 100, you can compare the effects of market volatilities on WisdomTree Platinum and WisdomTree NASDAQ 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 NASDAQ. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree Platinum and WisdomTree NASDAQ.
Diversification Opportunities for WisdomTree Platinum and WisdomTree NASDAQ
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between WisdomTree and WisdomTree is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree Platinum 2x and WisdomTree NASDAQ 100 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree NASDAQ 100 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 NASDAQ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree NASDAQ 100 has no effect on the direction of WisdomTree Platinum i.e., WisdomTree Platinum and WisdomTree NASDAQ go up and down completely randomly.
Pair Corralation between WisdomTree Platinum and WisdomTree NASDAQ
Assuming the 90 days trading horizon WisdomTree Platinum 2x is expected to generate 2.9 times more return on investment than WisdomTree NASDAQ. However, WisdomTree Platinum is 2.9 times more volatile than WisdomTree NASDAQ 100. It trades about 0.75 of its potential returns per unit of risk. WisdomTree NASDAQ 100 is currently generating about 0.03 per unit of risk. If you would invest 401.00 in WisdomTree Platinum 2x on September 28, 2025 and sell it today you would earn a total of 412.00 from holding WisdomTree Platinum 2x or generate 102.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
WisdomTree Platinum 2x vs. WisdomTree NASDAQ 100
Performance |
| Timeline |
| WisdomTree Platinum |
| WisdomTree NASDAQ 100 |
WisdomTree Platinum and WisdomTree NASDAQ Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree Platinum and WisdomTree NASDAQ
The main advantage of trading using opposite WisdomTree Platinum and WisdomTree NASDAQ positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree Platinum position performs unexpectedly, WisdomTree NASDAQ 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 NASDAQ will offset losses from the drop in WisdomTree NASDAQ'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 NASDAQ vs. Leverage Shares 3x | WisdomTree NASDAQ vs. Leverage Shares 3x | WisdomTree NASDAQ vs. Leverage Shares 3x | WisdomTree NASDAQ vs. WisdomTree Silver 3x |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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