Correlation Between IShares Silver and GraniteShares Gold

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

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

Diversification Opportunities for IShares Silver and GraniteShares Gold

0.93

Correlation Coefficient

IShares Silver  GraniteShares Gold

Almost no diversification

The 3 months correlation between IShares and GraniteShares is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding iShares Silver Trust and GraniteShares Gold Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GraniteShares Gold Trust and IShares Silver 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 Silver Trust are associated (or correlated) with GraniteShares Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GraniteShares Gold Trust has no effect on the direction of IShares Silver i.e., IShares Silver and GraniteShares Gold go up and down completely randomly.

Pair Corralation between IShares Silver and GraniteShares Gold

Considering the 90-day investment horizon iShares Silver Trust is expected to generate 2.03 times more return on investment than GraniteShares Gold. However, IShares Silver is 2.03 times more volatile than GraniteShares Gold Trust. It trades about 0.08 of its potential returns per unit of risk. GraniteShares Gold Trust is currently generating about 0.11 per unit of risk. If you would invest  2,558  in iShares Silver Trust on September 1, 2024 and sell it today you would earn a total of  234.00  from holding iShares Silver Trust or generate 9.15% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

iShares Silver Trust  vs.  GraniteShares Gold Trust

iShares Silver Trust

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in iShares Silver Trust are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady essential indicators, IShares Silver may actually be approaching a critical reversion point that can send shares even higher in December 2024.

GraniteShares Gold Trust

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in GraniteShares Gold Trust are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating basic indicators, GraniteShares Gold may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Pair Trading with IShares Silver and GraniteShares Gold

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

The idea behind iShares Silver Trust and GraniteShares Gold 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.