Correlation Between WisdomTree Natural and WisdomTree Precious
Can any of the company-specific risk be diversified away by investing in both WisdomTree Natural and WisdomTree Precious 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 Natural and WisdomTree Precious into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WisdomTree Natural Gas and WisdomTree Precious Metals, you can compare the effects of market volatilities on WisdomTree Natural and WisdomTree Precious 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 Natural with a short position of WisdomTree Precious. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree Natural and WisdomTree Precious.
Diversification Opportunities for WisdomTree Natural and WisdomTree Precious
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between WisdomTree and WisdomTree is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree Natural Gas and WisdomTree Precious Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Precious and WisdomTree 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 WisdomTree Natural Gas are associated (or correlated) with WisdomTree Precious. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Precious has no effect on the direction of WisdomTree Natural i.e., WisdomTree Natural and WisdomTree Precious go up and down completely randomly.
Pair Corralation between WisdomTree Natural and WisdomTree Precious
Assuming the 90 days trading horizon WisdomTree Natural is expected to generate 58.66 times less return on investment than WisdomTree Precious. But when comparing it to its historical volatility, WisdomTree Natural Gas is 5.23 times less risky than WisdomTree Precious. It trades about 0.01 of its potential returns per unit of risk. WisdomTree Precious Metals is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,835 in WisdomTree Precious Metals on November 9, 2025 and sell it today you would earn a total of 3,022 from holding WisdomTree Precious Metals or generate 164.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
WisdomTree Natural Gas vs. WisdomTree Precious Metals
Performance |
| Timeline |
| WisdomTree Natural Gas |
| WisdomTree Precious |
WisdomTree Natural and WisdomTree Precious Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree Natural and WisdomTree Precious
The main advantage of trading using opposite WisdomTree Natural and WisdomTree Precious positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree Natural position performs unexpectedly, WisdomTree Precious 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 Precious will offset losses from the drop in WisdomTree Precious' long position.| WisdomTree Natural vs. Amundi MSCI USA | WisdomTree Natural vs. Lyxor UCITS MSCI | WisdomTree Natural vs. Amundi SP 500 | WisdomTree Natural vs. Amundi SP 500 |
| WisdomTree Precious vs. WisdomTree Wheat EUR | WisdomTree Precious vs. WisdomTree Physical Bitcoin | WisdomTree Precious vs. WisdomTree Gold EUR | WisdomTree Precious vs. WisdomTree Physical Cardano |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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