Correlation Between GraniteShares Bloomberg and WisdomTree Continuous

Can any of the company-specific risk be diversified away by investing in both GraniteShares Bloomberg and WisdomTree Continuous 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 GraniteShares Bloomberg and WisdomTree Continuous into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GraniteShares Bloomberg Commodity and WisdomTree Continuous Commodity, you can compare the effects of market volatilities on GraniteShares Bloomberg and WisdomTree Continuous 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 GraniteShares Bloomberg with a short position of WisdomTree Continuous. Check out your portfolio center. Please also check ongoing floating volatility patterns of GraniteShares Bloomberg and WisdomTree Continuous.

Diversification Opportunities for GraniteShares Bloomberg and WisdomTree Continuous

0.87

Correlation Coefficient

GraniteShares Bloomberg  WisdomTree Continuous

Very poor diversification

The 3 months correlation between GraniteShares and WisdomTree is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding GraniteShares Bloomberg Commod and WisdomTree Continuous Commodit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Continuous and GraniteShares Bloomberg 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 GraniteShares Bloomberg Commodity are associated (or correlated) with WisdomTree Continuous. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Continuous has no effect on the direction of GraniteShares Bloomberg i.e., GraniteShares Bloomberg and WisdomTree Continuous go up and down completely randomly.

Pair Corralation between GraniteShares Bloomberg and WisdomTree Continuous

Given the investment horizon of 90 days GraniteShares Bloomberg is expected to generate 2.1 times less return on investment than WisdomTree Continuous. In addition to that, GraniteShares Bloomberg is 1.16 times more volatile than WisdomTree Continuous Commodity. It trades about 0.09 of its total potential returns per unit of risk. WisdomTree Continuous Commodity is currently generating about 0.22 per unit of volatility. If you would invest  1,886  in WisdomTree Continuous Commodity on May 1, 2025 and sell it today you would earn a total of  169.00  from holding WisdomTree Continuous Commodity or generate 8.96% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	98.39%
Values	Daily Returns

GraniteShares Bloomberg Commod  vs.  WisdomTree Continuous Commodit

GraniteShares Bloomberg

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in GraniteShares Bloomberg Commodity are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong primary indicators, GraniteShares Bloomberg is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

WisdomTree Continuous

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in WisdomTree Continuous Commodity are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak fundamental indicators, WisdomTree Continuous may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with GraniteShares Bloomberg and WisdomTree Continuous

The main advantage of trading using opposite GraniteShares Bloomberg and WisdomTree Continuous positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GraniteShares Bloomberg position performs unexpectedly, WisdomTree Continuous 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 Continuous will offset losses from the drop in WisdomTree Continuous' long position.

The idea behind GraniteShares Bloomberg Commodity and WisdomTree Continuous Commodity 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.