Correlation Between SPDR SP and WisdomTree Europe
Can any of the company-specific risk be diversified away by investing in both SPDR SP and WisdomTree Europe 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 SPDR SP and WisdomTree Europe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR SP Industrials and WisdomTree Europe SmallCap, you can compare the effects of market volatilities on SPDR SP and WisdomTree Europe 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 SPDR SP with a short position of WisdomTree Europe. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR SP and WisdomTree Europe.
Diversification Opportunities for SPDR SP and WisdomTree Europe
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between SPDR and WisdomTree is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding SPDR SP Industrials and WisdomTree Europe SmallCap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Europe and SPDR SP 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 SPDR SP Industrials are associated (or correlated) with WisdomTree Europe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Europe has no effect on the direction of SPDR SP i.e., SPDR SP and WisdomTree Europe go up and down completely randomly.
Pair Corralation between SPDR SP and WisdomTree Europe
Assuming the 90 days trading horizon SPDR SP Industrials is expected to generate 2.19 times more return on investment than WisdomTree Europe. However, SPDR SP is 2.19 times more volatile than WisdomTree Europe SmallCap. It trades about 0.37 of its potential returns per unit of risk. WisdomTree Europe SmallCap is currently generating about 0.51 per unit of risk. If you would invest 6,485 in SPDR SP Industrials on November 22, 2025 and sell it today you would earn a total of 1,161 from holding SPDR SP Industrials or generate 17.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 98.31% |
| Values | Daily Returns |
SPDR SP Industrials vs. WisdomTree Europe SmallCap
Performance |
| Timeline |
| SPDR SP Industrials |
| WisdomTree Europe |
SPDR SP and WisdomTree Europe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR SP and WisdomTree Europe
The main advantage of trading using opposite SPDR SP and WisdomTree Europe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR SP position performs unexpectedly, WisdomTree Europe 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 Europe will offset losses from the drop in WisdomTree Europe's long position.| SPDR SP vs. iShares MSCI USA | SPDR SP vs. Invesco EQQQ NASDAQ 100 | SPDR SP vs. iShares VII PLC | SPDR SP vs. iShares MSCI North |
| WisdomTree Europe vs. HSBC MSCI Emerging | WisdomTree Europe vs. UBS ETF plc | WisdomTree Europe vs. Amundi Index Solutions | WisdomTree Europe vs. SPDR Bloomberg 1 3 |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |