Correlation Between WisdomTree Physical and WisdomTree Physical

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

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

Diversification Opportunities for WisdomTree Physical and WisdomTree Physical

-0.81

Correlation Coefficient

WisdomTree Physical  WisdomTree Physical

Pay attention - limited upside

The 3 months correlation between WisdomTree and WisdomTree is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree Physical XRP and WisdomTree Physical Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Physical Gold and WisdomTree Physical 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 Physical XRP are associated (or correlated) with WisdomTree Physical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Physical Gold has no effect on the direction of WisdomTree Physical i.e., WisdomTree Physical and WisdomTree Physical go up and down completely randomly.

Pair Corralation between WisdomTree Physical and WisdomTree Physical

Assuming the 90 days trading horizon WisdomTree Physical XRP is expected to under-perform the WisdomTree Physical. In addition to that, WisdomTree Physical is 3.36 times more volatile than WisdomTree Physical Gold. It trades about -0.08 of its total potential returns per unit of risk. WisdomTree Physical Gold is currently generating about 0.21 per unit of volatility. If you would invest  28,444  in WisdomTree Physical Gold on September 5, 2025 and sell it today you would earn a total of  5,174  from holding WisdomTree Physical Gold or generate 18.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

WisdomTree Physical XRP  vs.  WisdomTree Physical Gold

WisdomTree Physical XRP

Risk-Adjusted Performance

Weakest

Over the last 90 days WisdomTree Physical XRP has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Etf's basic indicators remain comparatively stable which may send shares a bit higher in January 2026. The newest uproar may also be a sign of mid-term up-swing for the exchange-traded fund private investors.

WisdomTree Physical Gold

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in WisdomTree Physical Gold are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, WisdomTree Physical unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with WisdomTree Physical and WisdomTree Physical

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

The idea behind WisdomTree Physical XRP and WisdomTree Physical Gold 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.

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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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..