Correlation Between Dimensional Small and WisdomTree Siegel
Can any of the company-specific risk be diversified away by investing in both Dimensional Small and WisdomTree Siegel 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 Dimensional Small and WisdomTree Siegel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dimensional Small Cap and WisdomTree Siegel Moderate, you can compare the effects of market volatilities on Dimensional Small and WisdomTree Siegel 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 Dimensional Small with a short position of WisdomTree Siegel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dimensional Small and WisdomTree Siegel.
Diversification Opportunities for Dimensional Small and WisdomTree Siegel
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Dimensional and WisdomTree is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Dimensional Small Cap and WisdomTree Siegel Moderate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Siegel and Dimensional Small 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 Dimensional Small Cap are associated (or correlated) with WisdomTree Siegel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Siegel has no effect on the direction of Dimensional Small i.e., Dimensional Small and WisdomTree Siegel go up and down completely randomly.
Pair Corralation between Dimensional Small and WisdomTree Siegel
Given the investment horizon of 90 days Dimensional Small Cap is expected to generate 2.5 times more return on investment than WisdomTree Siegel. However, Dimensional Small is 2.5 times more volatile than WisdomTree Siegel Moderate. It trades about 0.14 of its potential returns per unit of risk. WisdomTree Siegel Moderate is currently generating about 0.25 per unit of risk. If you would invest 6,927 in Dimensional Small Cap on November 30, 2025 and sell it today you would earn a total of 581.00 from holding Dimensional Small Cap or generate 8.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dimensional Small Cap vs. WisdomTree Siegel Moderate
Performance |
| Timeline |
| Dimensional Small Cap |
| WisdomTree Siegel |
Dimensional Small and WisdomTree Siegel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dimensional Small and WisdomTree Siegel
The main advantage of trading using opposite Dimensional Small and WisdomTree Siegel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dimensional Small position performs unexpectedly, WisdomTree Siegel 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 Siegel will offset losses from the drop in WisdomTree Siegel's long position.| Dimensional Small vs. Dimensional Targeted Value | Dimensional Small vs. Dimensional Marketwide Value | Dimensional Small vs. Dimensional International Core | Dimensional Small vs. Vanguard Pacific Stock |
| WisdomTree Siegel vs. Wisdomtree Digital Trust | WisdomTree Siegel vs. Wisdomtree Digital Trust | WisdomTree Siegel vs. Wisdomtree Digital Trust | WisdomTree Siegel vs. Wisdomtree Digital Trust |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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