Diversifying investments through commodity ETFs and correlations

As April ends, the table below shows the correlations aong all commodity ETFs on the market. These correlations are essential for proper diversification of investments.

(please click on image to enlarge)

For diversification, one would avoid the red and green pairs, which indicate high correlations. The pairs that have very low correlation are shown in bold font. Some of the best pairs are:

• UAG and GRN
• RJZ and DBA
• FUE and BAL
• PWND and COQ, DBA, GCC, GRU, JJA
• UAG and LD
• UCD and SGG