Correlation Between Wealthsimple Shariah and Internet Ultrasector

Can any of the company-specific risk be diversified away by investing in both Wealthsimple Shariah and Internet Ultrasector 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 Wealthsimple Shariah and Internet Ultrasector into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Wealthsimple Shariah World and Internet Ultrasector Profund, you can compare the effects of market volatilities on Wealthsimple Shariah and Internet Ultrasector 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 Wealthsimple Shariah with a short position of Internet Ultrasector. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wealthsimple Shariah and Internet Ultrasector.

Diversification Opportunities for Wealthsimple Shariah and Internet Ultrasector

0.24

Correlation Coefficient

Wealthsimple Shariah  Internet Ultrasector

Modest diversification

The 3 months correlation between Wealthsimple and Internet is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Wealthsimple Shariah World and Internet Ultrasector Profund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Internet Ultrasector and Wealthsimple Shariah 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 Wealthsimple Shariah World are associated (or correlated) with Internet Ultrasector. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Internet Ultrasector has no effect on the direction of Wealthsimple Shariah i.e., Wealthsimple Shariah and Internet Ultrasector go up and down completely randomly.

Pair Corralation between Wealthsimple Shariah and Internet Ultrasector

Assuming the 90 days trading horizon Wealthsimple Shariah World is expected to generate 0.4 times more return on investment than Internet Ultrasector. However, Wealthsimple Shariah World is 2.5 times less risky than Internet Ultrasector. It trades about 0.01 of its potential returns per unit of risk. Internet Ultrasector Profund is currently generating about -0.08 per unit of risk. If you would invest  3,223  in Wealthsimple Shariah World on August 25, 2025 and sell it today you would earn a total of  4.00  from holding Wealthsimple Shariah World or generate 0.12% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.46%
Values	Daily Returns

Wealthsimple Shariah World  vs.  Internet Ultrasector Profund

Wealthsimple Shariah

Risk-Adjusted Performance

Weakest

Over the last 90 days Wealthsimple Shariah World has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Wealthsimple Shariah is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Internet Ultrasector

Risk-Adjusted Performance

Weakest

Over the last 90 days Internet Ultrasector Profund has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Wealthsimple Shariah and Internet Ultrasector

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

The idea behind Wealthsimple Shariah World and Internet Ultrasector Profund 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..