Correlation Between WisdomTree Emerging and Intech SP

Can any of the company-specific risk be diversified away by investing in both WisdomTree Emerging and Intech SP 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 Emerging and Intech SP into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between WisdomTree Emerging Markets and Intech SP Small Mid, you can compare the effects of market volatilities on WisdomTree Emerging and Intech SP 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 Emerging with a short position of Intech SP. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree Emerging and Intech SP.

Diversification Opportunities for WisdomTree Emerging and Intech SP

0.6

Correlation Coefficient

WisdomTree Emerging  Intech SP

Poor diversification

The 3 months correlation between WisdomTree and Intech is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree Emerging Markets and Intech SP Small Mid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intech SP Small and WisdomTree Emerging 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 Emerging Markets are associated (or correlated) with Intech SP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intech SP Small has no effect on the direction of WisdomTree Emerging i.e., WisdomTree Emerging and Intech SP go up and down completely randomly.

Pair Corralation between WisdomTree Emerging and Intech SP

Allowing for the 90-day total investment horizon WisdomTree Emerging Markets is expected to generate 0.56 times more return on investment than Intech SP. However, WisdomTree Emerging Markets is 1.78 times less risky than Intech SP. It trades about 0.13 of its potential returns per unit of risk. Intech SP Small Mid is currently generating about 0.05 per unit of risk. If you would invest  3,123  in WisdomTree Emerging Markets on October 4, 2025 and sell it today you would earn a total of  149.00  from holding WisdomTree Emerging Markets or generate 4.77% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

WisdomTree Emerging Markets  vs.  Intech SP Small Mid

WisdomTree Emerging

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in WisdomTree Emerging Markets are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound fundamental indicators, WisdomTree Emerging is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Intech SP Small

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Intech SP Small Mid are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong fundamental indicators, Intech SP is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with WisdomTree Emerging and Intech SP

The main advantage of trading using opposite WisdomTree Emerging and Intech SP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree Emerging position performs unexpectedly, Intech SP 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 Intech SP will offset losses from the drop in Intech SP's long position.

The idea behind WisdomTree Emerging Markets and Intech SP Small Mid pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.