Correlation Between WisdomTree High and Grayscale Funds

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

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

Diversification Opportunities for WisdomTree High and Grayscale Funds

-0.29

Correlation Coefficient

WisdomTree High  Grayscale Funds

Very good diversification

The 3 months correlation between WisdomTree and Grayscale is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree High Income and Grayscale Funds Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grayscale Funds Trust and WisdomTree High 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 High Income are associated (or correlated) with Grayscale Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grayscale Funds Trust has no effect on the direction of WisdomTree High i.e., WisdomTree High and Grayscale Funds go up and down completely randomly.

Pair Corralation between WisdomTree High and Grayscale Funds

Given the investment horizon of 90 days WisdomTree High Income is expected to generate 0.07 times more return on investment than Grayscale Funds. However, WisdomTree High Income is 14.04 times less risky than Grayscale Funds. It trades about 0.39 of its potential returns per unit of risk. Grayscale Funds Trust is currently generating about -0.13 per unit of risk. If you would invest  2,459  in WisdomTree High Income on August 17, 2025 and sell it today you would earn a total of  101.00  from holding WisdomTree High Income or generate 4.11% return on investment over 90 days.

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

WisdomTree High Income  vs.  Grayscale Funds Trust

WisdomTree High Income

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in WisdomTree High Income are ranked lower than 31 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong primary indicators, WisdomTree High is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Grayscale Funds Trust

Risk-Adjusted Performance

Weakest

Over the last 90 days Grayscale Funds Trust has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Etf's basic indicators remain fairly strong which may send shares a bit higher in December 2025. The recent confusion may also be a sign of long-lasting up-swing for the Etf traders.

Pair Trading with WisdomTree High and Grayscale Funds

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

The idea behind WisdomTree High Income and Grayscale Funds Trust 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.