Correlation Between WisdomTree Global and Consumer Goods
Can any of the company-specific risk be diversified away by investing in both WisdomTree Global and Consumer Goods 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 Global and Consumer Goods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WisdomTree Global Defense and Consumer Goods Ultrasector, you can compare the effects of market volatilities on WisdomTree Global and Consumer Goods 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 Global with a short position of Consumer Goods. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree Global and Consumer Goods.
Diversification Opportunities for WisdomTree Global and Consumer Goods
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between WisdomTree and Consumer is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree Global Defense and Consumer Goods Ultrasector in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Consumer Goods Ultra and WisdomTree Global 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 Global Defense are associated (or correlated) with Consumer Goods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Consumer Goods Ultra has no effect on the direction of WisdomTree Global i.e., WisdomTree Global and Consumer Goods go up and down completely randomly.
Pair Corralation between WisdomTree Global and Consumer Goods
Given the investment horizon of 90 days WisdomTree Global Defense is expected to generate 0.99 times more return on investment than Consumer Goods. However, WisdomTree Global Defense is 1.01 times less risky than Consumer Goods. It trades about 0.76 of its potential returns per unit of risk. Consumer Goods Ultrasector is currently generating about 0.26 per unit of risk. If you would invest 2,974 in WisdomTree Global Defense on October 19, 2025 and sell it today you would earn a total of 609.00 from holding WisdomTree Global Defense or generate 20.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
WisdomTree Global Defense vs. Consumer Goods Ultrasector
Performance |
| Timeline |
| WisdomTree Global Defense |
| Consumer Goods Ultra |
WisdomTree Global and Consumer Goods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree Global and Consumer Goods
The main advantage of trading using opposite WisdomTree Global and Consumer Goods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree Global position performs unexpectedly, Consumer Goods 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 Consumer Goods will offset losses from the drop in Consumer Goods' long position.| WisdomTree Global vs. Tidal Trust II | WisdomTree Global vs. Innovator ETFs Trust | WisdomTree Global vs. YieldMax Target 12 | WisdomTree Global vs. Hotchkis Wiley SMID |
| Consumer Goods vs. Sp Smallcap 600 | Consumer Goods vs. Energy Services Fund | Consumer Goods vs. The RBB Fund | Consumer Goods vs. Mississippi Tax Free Income |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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