Correlation Between SWP Growth and WisdomTree Emerging
Can any of the company-specific risk be diversified away by investing in both SWP Growth 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 SWP Growth and WisdomTree Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SWP Growth Income and WisdomTree Emerging Markets, you can compare the effects of market volatilities on SWP Growth 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 SWP Growth with a short position of WisdomTree Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of SWP Growth and WisdomTree Emerging.
Diversification Opportunities for SWP Growth and WisdomTree Emerging
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between SWP and WisdomTree is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding SWP Growth Income and WisdomTree Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Emerging and SWP Growth 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 SWP Growth Income 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 SWP Growth i.e., SWP Growth and WisdomTree Emerging go up and down completely randomly.
Pair Corralation between SWP Growth and WisdomTree Emerging
Considering the 90-day investment horizon SWP Growth is expected to generate 3.63 times less return on investment than WisdomTree Emerging. In addition to that, SWP Growth is 1.11 times more volatile than WisdomTree Emerging Markets. It trades about 0.09 of its total potential returns per unit of risk. WisdomTree Emerging Markets is currently generating about 0.35 per unit of volatility. If you would invest 5,639 in WisdomTree Emerging Markets on November 29, 2025 and sell it today you would earn a total of 844.00 from holding WisdomTree Emerging Markets or generate 14.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SWP Growth Income vs. WisdomTree Emerging Markets
Performance |
| Timeline |
| SWP Growth Income |
| WisdomTree Emerging |
SWP Growth and WisdomTree Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SWP Growth and WisdomTree Emerging
The main advantage of trading using opposite SWP Growth and WisdomTree Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SWP Growth 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.| SWP Growth vs. FT Vest Equity | SWP Growth vs. Northern Lights | SWP Growth vs. Diamond Hill Funds | SWP Growth vs. Dimensional International High |
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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