Correlation Between AB Active and WisdomTree Dynamic
Can any of the company-specific risk be diversified away by investing in both AB Active and WisdomTree Dynamic 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 AB Active and WisdomTree Dynamic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AB Active ETFs and WisdomTree Dynamic Currency, you can compare the effects of market volatilities on AB Active and WisdomTree Dynamic 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 AB Active with a short position of WisdomTree Dynamic. Check out your portfolio center. Please also check ongoing floating volatility patterns of AB Active and WisdomTree Dynamic.
Diversification Opportunities for AB Active and WisdomTree Dynamic
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between CAM and WisdomTree is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding AB Active ETFs and WisdomTree Dynamic Currency in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Dynamic and AB Active 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 AB Active ETFs are associated (or correlated) with WisdomTree Dynamic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Dynamic has no effect on the direction of AB Active i.e., AB Active and WisdomTree Dynamic go up and down completely randomly.
Pair Corralation between AB Active and WisdomTree Dynamic
Considering the 90-day investment horizon AB Active is expected to generate 3.54 times less return on investment than WisdomTree Dynamic. But when comparing it to its historical volatility, AB Active ETFs is 8.61 times less risky than WisdomTree Dynamic. It trades about 0.25 of its potential returns per unit of risk. WisdomTree Dynamic Currency is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 3,024 in WisdomTree Dynamic Currency on October 18, 2025 and sell it today you would earn a total of 1,479 from holding WisdomTree Dynamic Currency or generate 48.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 14.37% |
| Values | Daily Returns |
AB Active ETFs vs. WisdomTree Dynamic Currency
Performance |
| Timeline |
| AB Active ETFs |
| WisdomTree Dynamic |
AB Active and WisdomTree Dynamic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AB Active and WisdomTree Dynamic
The main advantage of trading using opposite AB Active and WisdomTree Dynamic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AB Active position performs unexpectedly, WisdomTree Dynamic 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 WisdomTree Dynamic will offset losses from the drop in WisdomTree Dynamic's long position.| AB Active vs. VanEck Vectors Moodys | AB Active vs. Valued Advisers Trust | AB Active vs. Xtrackers California Municipal | AB Active vs. Principal Exchange Traded Funds |
| WisdomTree Dynamic vs. WisdomTree MidCap Earnings | WisdomTree Dynamic vs. iShares Morningstar Mid Cap | WisdomTree Dynamic vs. Vanguard Russell 2000 | WisdomTree Dynamic vs. iShares MSCI Global |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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