Correlation Between WisdomTree High and WisdomTree Trust
Can any of the company-specific risk be diversified away by investing in both WisdomTree High and WisdomTree Trust 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 High and WisdomTree Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WisdomTree High Dividend and WisdomTree Trust , you can compare the effects of market volatilities on WisdomTree High and WisdomTree Trust 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 High with a short position of WisdomTree Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree High and WisdomTree Trust.
Diversification Opportunities for WisdomTree High and WisdomTree Trust
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between WisdomTree and WisdomTree is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree High Dividend and WisdomTree Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Trust and WisdomTree High 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 High Dividend are associated (or correlated) with WisdomTree Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Trust has no effect on the direction of WisdomTree High i.e., WisdomTree High and WisdomTree Trust go up and down completely randomly.
Pair Corralation between WisdomTree High and WisdomTree Trust
Assuming the 90 days trading horizon WisdomTree High Dividend is expected to under-perform the WisdomTree Trust. But the etf apears to be less risky and, when comparing its historical volatility, WisdomTree High Dividend is 4.64 times less risky than WisdomTree Trust. The etf trades about -0.06 of its potential returns per unit of risk. The WisdomTree Trust is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 243,000 in WisdomTree Trust on October 26, 2025 and sell it today you would earn a total of 24,500 from holding WisdomTree Trust or generate 10.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.39% |
| Values | Daily Returns |
WisdomTree High Dividend vs. WisdomTree Trust
Performance |
| Timeline |
| WisdomTree High Dividend |
| WisdomTree Trust |
WisdomTree High and WisdomTree Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree High and WisdomTree Trust
The main advantage of trading using opposite WisdomTree High and WisdomTree Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree High position performs unexpectedly, WisdomTree Trust 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 Trust will offset losses from the drop in WisdomTree Trust's long position.| WisdomTree High vs. WisdomTree Trust | WisdomTree High vs. WisdomTree Trust | WisdomTree High vs. Vanguard Funds Public | WisdomTree High vs. Direxion Daily Junior |
| WisdomTree Trust vs. Vanguard Index Funds | WisdomTree Trust vs. Vanguard SP 500 | WisdomTree Trust vs. Vanguard STAR Funds | WisdomTree Trust vs. SPDR SP 500 |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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