Gold, currency pairs, bonds and equities can respond to shared economic forces. But a correlation measures a relationship over a particular sample, not a permanent law. A dollar rally and a gold rally can occur together under some conditions.
Distinguish a narrative from a measured relationship. Compare returns rather than raw price levels, align timestamps and test several windows. Risk-on and risk-off are shorthand descriptions; different assets can disagree. Do not add several exposures and assume they diversify simply because their names differ.
Worked example
Two positions each planned to risk 50 USD may both lose during the same dollar shock. Their combined planned risk is 100 USD, with possible extra loss from gaps or slippage.
Check your understanding
Does yesterday’s negative correlation guarantee opposite price moves tomorrow?
Show explanation
No. The relationship is sample-dependent and can weaken or reverse.
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