Correlation Between WisdomTree Managed and Dimensional Core
Can any of the company-specific risk be diversified away by investing in both WisdomTree Managed and Dimensional Core 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 Managed and Dimensional Core into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WisdomTree Managed Futures and Dimensional Core Equity, you can compare the effects of market volatilities on WisdomTree Managed and Dimensional Core 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 Managed with a short position of Dimensional Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree Managed and Dimensional Core.
Diversification Opportunities for WisdomTree Managed and Dimensional Core
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between WisdomTree and Dimensional is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree Managed Futures and Dimensional Core Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dimensional Core Equity and WisdomTree Managed 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 Managed Futures are associated (or correlated) with Dimensional Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dimensional Core Equity has no effect on the direction of WisdomTree Managed i.e., WisdomTree Managed and Dimensional Core go up and down completely randomly.
Pair Corralation between WisdomTree Managed and Dimensional Core
Given the investment horizon of 90 days WisdomTree Managed is expected to generate 1.35 times less return on investment than Dimensional Core. But when comparing it to its historical volatility, WisdomTree Managed Futures is 1.06 times less risky than Dimensional Core. It trades about 0.09 of its potential returns per unit of risk. Dimensional Core Equity is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 3,853 in Dimensional Core Equity on November 7, 2025 and sell it today you would earn a total of 187.00 from holding Dimensional Core Equity or generate 4.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 98.36% |
| Values | Daily Returns |
WisdomTree Managed Futures vs. Dimensional Core Equity
Performance |
| Timeline |
| WisdomTree Managed |
| Dimensional Core Equity |
WisdomTree Managed and Dimensional Core Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree Managed and Dimensional Core
The main advantage of trading using opposite WisdomTree Managed and Dimensional Core positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree Managed position performs unexpectedly, Dimensional Core 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 Dimensional Core will offset losses from the drop in Dimensional Core's long position.| WisdomTree Managed vs. Elevation Series Trust | WisdomTree Managed vs. Exchange Traded Concepts | WisdomTree Managed vs. Innovator MSCI EAFE | WisdomTree Managed vs. VanEck Inflation Allocation |
| Dimensional Core vs. SPDR Dow Jones | Dimensional Core vs. Vanguard Small Cap Growth | Dimensional Core vs. Vanguard Small Cap Growth | Dimensional Core vs. Schwab Broad Market |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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