Correlation Between WisdomTree International and EA Series
Can any of the company-specific risk be diversified away by investing in both WisdomTree International and EA Series 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 International and EA Series into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WisdomTree International Al and EA Series Trust, you can compare the effects of market volatilities on WisdomTree International and EA Series 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 International with a short position of EA Series. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree International and EA Series.
Diversification Opportunities for WisdomTree International and EA Series
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between WisdomTree and TBG is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree International Al and EA Series Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EA Series Trust and WisdomTree International 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 International Al are associated (or correlated) with EA Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EA Series Trust has no effect on the direction of WisdomTree International i.e., WisdomTree International and EA Series go up and down completely randomly.
Pair Corralation between WisdomTree International and EA Series
Given the investment horizon of 90 days WisdomTree International is expected to generate 14.95 times less return on investment than EA Series. In addition to that, WisdomTree International is 1.18 times more volatile than EA Series Trust. It trades about 0.01 of its total potential returns per unit of risk. EA Series Trust is currently generating about 0.21 per unit of volatility. If you would invest 2,836 in EA Series Trust on September 1, 2024 and sell it today you would earn a total of 563.00 from holding EA Series Trust or generate 19.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
WisdomTree International Al vs. EA Series Trust
Performance |
| Timeline |
| WisdomTree International |
| EA Series Trust |
WisdomTree International and EA Series Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree International and EA Series
The main advantage of trading using opposite WisdomTree International and EA Series positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree International position performs unexpectedly, EA Series 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 EA Series will offset losses from the drop in EA Series' long position.| WisdomTree International vs. WisdomTree Trust | WisdomTree International vs. IQ Global Equity | WisdomTree International vs. WisdomTree Trust | WisdomTree International vs. WisdomTree International High |
| EA Series vs. iShares Core SP | EA Series vs. iShares Core MSCI | EA Series vs. iShares Broad USD | EA Series vs. iShares Core SP |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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