Correlation Between WisdomTree MidCap and First Trust
Can any of the company-specific risk be diversified away by investing in both WisdomTree MidCap and First 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 MidCap and First Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WisdomTree MidCap Dividend and First Trust RBA, you can compare the effects of market volatilities on WisdomTree MidCap and First 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 MidCap with a short position of First Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree MidCap and First Trust.
Diversification Opportunities for WisdomTree MidCap and First Trust
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between WisdomTree and First is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree MidCap Dividend and First Trust RBA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Trust RBA and WisdomTree MidCap 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 MidCap Dividend are associated (or correlated) with First Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Trust RBA has no effect on the direction of WisdomTree MidCap i.e., WisdomTree MidCap and First Trust go up and down completely randomly.
Pair Corralation between WisdomTree MidCap and First Trust
Considering the 90-day investment horizon WisdomTree MidCap Dividend is expected to generate 0.84 times more return on investment than First Trust. However, WisdomTree MidCap Dividend is 1.19 times less risky than First Trust. It trades about 0.23 of its potential returns per unit of risk. First Trust RBA is currently generating about 0.17 per unit of risk. If you would invest 5,047 in WisdomTree MidCap Dividend on November 14, 2025 and sell it today you would earn a total of 592.00 from holding WisdomTree MidCap Dividend or generate 11.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
WisdomTree MidCap Dividend vs. First Trust RBA
Performance |
| Timeline |
| WisdomTree MidCap |
| First Trust RBA |
WisdomTree MidCap and First Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree MidCap and First Trust
The main advantage of trading using opposite WisdomTree MidCap and First Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree MidCap position performs unexpectedly, First 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 First Trust will offset losses from the drop in First Trust's long position.| WisdomTree MidCap vs. iShares MSCI Emerging | WisdomTree MidCap vs. Allspring Exchange Traded Funds | WisdomTree MidCap vs. WHITEWOLF Publicly Listed | WisdomTree MidCap vs. iShares Environmentally Aware |
| First Trust vs. InfraCap Equity Income | First Trust vs. abrdn Focused Small | First Trust vs. KraneShares MSCI Emerging | First Trust vs. Cambria Value and |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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