Correlation Between WisdomTree Earnings and Global X
Can any of the company-specific risk be diversified away by investing in both WisdomTree Earnings and Global X 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 Earnings and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WisdomTree Earnings 500 and Global X Funds, you can compare the effects of market volatilities on WisdomTree Earnings and Global X 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 Earnings with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree Earnings and Global X.
Diversification Opportunities for WisdomTree Earnings and Global X
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between WisdomTree and Global is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree Earnings 500 and Global X Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Funds and WisdomTree Earnings 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 Earnings 500 are associated (or correlated) with Global X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global X Funds has no effect on the direction of WisdomTree Earnings i.e., WisdomTree Earnings and Global X go up and down completely randomly.
Pair Corralation between WisdomTree Earnings and Global X
Considering the 90-day investment horizon WisdomTree Earnings is expected to generate 2.24 times less return on investment than Global X. But when comparing it to its historical volatility, WisdomTree Earnings 500 is 1.84 times less risky than Global X. It trades about 0.09 of its potential returns per unit of risk. Global X Funds is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 9,522 in Global X Funds on October 10, 2025 and sell it today you would earn a total of 489.00 from holding Global X Funds or generate 5.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.56% |
| Values | Daily Returns |
WisdomTree Earnings 500 vs. Global X Funds
Performance |
| Timeline |
| WisdomTree Earnings 500 |
| Global X Funds |
WisdomTree Earnings and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree Earnings and Global X
The main advantage of trading using opposite WisdomTree Earnings and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree Earnings position performs unexpectedly, Global X 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 Global X will offset losses from the drop in Global X's long position.| WisdomTree Earnings vs. WisdomTree High Dividend | WisdomTree Earnings vs. iShares Consumer Staples | WisdomTree Earnings vs. iShares MSCI Switzerland | WisdomTree Earnings vs. Direxion NASDAQ 100 Equal |
| Global X vs. iShares Consumer Staples | Global X vs. JPMorgan Emerging Markets | Global X vs. Vanguard Russell 2000 | Global X vs. Nuveen ESG Small Cap |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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