Correlation Between Fidelity Small and WisdomTree Emerging
Can any of the company-specific risk be diversified away by investing in both Fidelity Small and WisdomTree Emerging 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 Fidelity Small and WisdomTree Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Small Mid Factor and WisdomTree Emerging Markets, you can compare the effects of market volatilities on Fidelity Small and WisdomTree Emerging 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 Fidelity Small with a short position of WisdomTree Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Small and WisdomTree Emerging.
Diversification Opportunities for Fidelity Small and WisdomTree Emerging
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fidelity and WisdomTree is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Small Mid Factor and WisdomTree Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Emerging and Fidelity 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 Fidelity Small Mid Factor are associated (or correlated) with WisdomTree Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Emerging has no effect on the direction of Fidelity Small i.e., Fidelity Small and WisdomTree Emerging go up and down completely randomly.
Pair Corralation between Fidelity Small and WisdomTree Emerging
Given the investment horizon of 90 days Fidelity Small is expected to generate 1.44 times less return on investment than WisdomTree Emerging. In addition to that, Fidelity Small is 1.27 times more volatile than WisdomTree Emerging Markets. It trades about 0.16 of its total potential returns per unit of risk. WisdomTree Emerging Markets is currently generating about 0.29 per unit of volatility. If you would invest 5,631 in WisdomTree Emerging Markets on October 11, 2025 and sell it today you would earn a total of 181.00 from holding WisdomTree Emerging Markets or generate 3.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Small Mid Factor vs. WisdomTree Emerging Markets
Performance |
| Timeline |
| Fidelity Small Mid |
| WisdomTree Emerging |
Fidelity Small and WisdomTree Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Small and WisdomTree Emerging
The main advantage of trading using opposite Fidelity Small and WisdomTree Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Small position performs unexpectedly, WisdomTree Emerging 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 Emerging will offset losses from the drop in WisdomTree Emerging's long position.| Fidelity Small vs. iShares Russell 2500 | Fidelity Small vs. WisdomTree Trust | Fidelity Small vs. Franklin LibertyQ Mid | Fidelity Small vs. iShares MSCI Australia |
| WisdomTree Emerging vs. WisdomTree SmallCap Dividend | WisdomTree Emerging vs. WisdomTree High Dividend | WisdomTree Emerging vs. Invesco FTSE RAFI | WisdomTree Emerging vs. iShares Utilities ETF |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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