Correlation Between Morgan Stanley and WisdomTree Interest
Can any of the company-specific risk be diversified away by investing in both Morgan Stanley and WisdomTree Interest 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 Morgan Stanley and WisdomTree Interest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Morgan Stanley ETF and WisdomTree Interest Rate, you can compare the effects of market volatilities on Morgan Stanley and WisdomTree Interest 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 Morgan Stanley with a short position of WisdomTree Interest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Morgan Stanley and WisdomTree Interest.
Diversification Opportunities for Morgan Stanley and WisdomTree Interest
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Morgan and WisdomTree is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Morgan Stanley ETF and WisdomTree Interest Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Interest Rate and Morgan Stanley 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 Morgan Stanley ETF are associated (or correlated) with WisdomTree Interest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Interest Rate has no effect on the direction of Morgan Stanley i.e., Morgan Stanley and WisdomTree Interest go up and down completely randomly.
Pair Corralation between Morgan Stanley and WisdomTree Interest
Given the investment horizon of 90 days Morgan Stanley ETF is expected to generate 4.96 times more return on investment than WisdomTree Interest. However, Morgan Stanley is 4.96 times more volatile than WisdomTree Interest Rate. It trades about 0.19 of its potential returns per unit of risk. WisdomTree Interest Rate is currently generating about 0.22 per unit of risk. If you would invest 2,527 in Morgan Stanley ETF on October 25, 2025 and sell it today you would earn a total of 195.00 from holding Morgan Stanley ETF or generate 7.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Morgan Stanley ETF vs. WisdomTree Interest Rate
Performance |
| Timeline |
| Morgan Stanley ETF |
| WisdomTree Interest Rate |
Morgan Stanley and WisdomTree Interest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Morgan Stanley and WisdomTree Interest
The main advantage of trading using opposite Morgan Stanley and WisdomTree Interest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Morgan Stanley position performs unexpectedly, WisdomTree Interest 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 Interest will offset losses from the drop in WisdomTree Interest's long position.| Morgan Stanley vs. 2023 EFT Series | Morgan Stanley vs. Russell Equity Income | Morgan Stanley vs. OneAscent International Equity | Morgan Stanley vs. JP Morgan Exchange Traded |
| WisdomTree Interest vs. WisdomTree Short Term Corporate | WisdomTree Interest vs. Bondbloxx ETF Trust | WisdomTree Interest vs. Bondbloxx ETF Trust | WisdomTree Interest vs. Invesco BulletShares 2030 |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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