Correlation Between IShares Gold and United States
Can any of the company-specific risk be diversified away by investing in both IShares Gold and United States 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 IShares Gold and United States into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Gold Trust and United States Copper, you can compare the effects of market volatilities on IShares Gold and United States 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 IShares Gold with a short position of United States. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Gold and United States.
Diversification Opportunities for IShares Gold and United States
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between IShares and United is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding iShares Gold Trust and United States Copper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United States Copper and IShares Gold 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 iShares Gold Trust are associated (or correlated) with United States. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United States Copper has no effect on the direction of IShares Gold i.e., IShares Gold and United States go up and down completely randomly.
Pair Corralation between IShares Gold and United States
Considering the 90-day investment horizon iShares Gold Trust is expected to generate 0.94 times more return on investment than United States. However, iShares Gold Trust is 1.06 times less risky than United States. It trades about 0.17 of its potential returns per unit of risk. United States Copper is currently generating about 0.15 per unit of risk. If you would invest 6,868 in iShares Gold Trust on September 12, 2025 and sell it today you would earn a total of 1,099 from holding iShares Gold Trust or generate 16.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Gold Trust vs. United States Copper
Performance |
| Timeline |
| iShares Gold Trust |
| United States Copper |
IShares Gold and United States Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Gold and United States
The main advantage of trading using opposite IShares Gold and United States positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Gold position performs unexpectedly, United States 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 United States will offset losses from the drop in United States' long position.| IShares Gold vs. Vanguard Primecap Fund | IShares Gold vs. Vanguard FTSE All World | IShares Gold vs. Vanguard Ftse All World | IShares Gold vs. Technology Select Sector |
| United States vs. iShares MSCI Brazil | United States vs. Putnam ETF Trust | United States vs. Invesco DB Precious | United States vs. DB Gold Double |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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