Correlation Between WisdomTree Emerging and Invesco Consumer
Can any of the company-specific risk be diversified away by investing in both WisdomTree Emerging and Invesco Consumer 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 Emerging and Invesco Consumer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WisdomTree Emerging Markets and Invesco Consumer Staples, you can compare the effects of market volatilities on WisdomTree Emerging and Invesco Consumer 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 Emerging with a short position of Invesco Consumer. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree Emerging and Invesco Consumer.
Diversification Opportunities for WisdomTree Emerging and Invesco Consumer
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between WisdomTree and Invesco is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree Emerging Markets and Invesco Consumer Staples in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Consumer Staples and WisdomTree Emerging 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 Emerging Markets are associated (or correlated) with Invesco Consumer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Consumer Staples has no effect on the direction of WisdomTree Emerging i.e., WisdomTree Emerging and Invesco Consumer go up and down completely randomly.
Pair Corralation between WisdomTree Emerging and Invesco Consumer
Assuming the 90 days trading horizon WisdomTree Emerging is expected to generate 1.45 times less return on investment than Invesco Consumer. But when comparing it to its historical volatility, WisdomTree Emerging Markets is 1.07 times less risky than Invesco Consumer. It trades about 0.18 of its potential returns per unit of risk. Invesco Consumer Staples is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 69,920 in Invesco Consumer Staples on November 26, 2025 and sell it today you would earn a total of 8,320 from holding Invesco Consumer Staples or generate 11.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
WisdomTree Emerging Markets vs. Invesco Consumer Staples
Performance |
| Timeline |
| WisdomTree Emerging |
| Invesco Consumer Staples |
WisdomTree Emerging and Invesco Consumer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree Emerging and Invesco Consumer
The main advantage of trading using opposite WisdomTree Emerging and Invesco Consumer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree Emerging position performs unexpectedly, Invesco Consumer 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 Invesco Consumer will offset losses from the drop in Invesco Consumer's long position.| WisdomTree Emerging vs. WisdomTree Battery Solutions | WisdomTree Emerging vs. WisdomTree Quality Dividend | WisdomTree Emerging vs. WisdomTree Cybersecurity UCITS |
| Invesco Consumer vs. Pictet CH CHF | Invesco Consumer vs. Procimmo Real Estate | Invesco Consumer vs. Banque Cantonale du | Invesco Consumer vs. Invesco EQQQ NASDAQ 100 |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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