Correlation Between WisdomTree Emerging and Freedom 100
Can any of the company-specific risk be diversified away by investing in both WisdomTree Emerging and Freedom 100 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 Freedom 100 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 Freedom 100 Emerging, you can compare the effects of market volatilities on WisdomTree Emerging and Freedom 100 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 Freedom 100. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree Emerging and Freedom 100.
Diversification Opportunities for WisdomTree Emerging and Freedom 100
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between WisdomTree and Freedom is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree Emerging Markets and Freedom 100 Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Freedom 100 Emerging 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 Freedom 100. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Freedom 100 Emerging has no effect on the direction of WisdomTree Emerging i.e., WisdomTree Emerging and Freedom 100 go up and down completely randomly.
Pair Corralation between WisdomTree Emerging and Freedom 100
Considering the 90-day investment horizon WisdomTree Emerging is expected to generate 2.12 times less return on investment than Freedom 100. But when comparing it to its historical volatility, WisdomTree Emerging Markets is 1.72 times less risky than Freedom 100. It trades about 0.17 of its potential returns per unit of risk. Freedom 100 Emerging is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 4,846 in Freedom 100 Emerging on December 5, 2025 and sell it today you would earn a total of 977.00 from holding Freedom 100 Emerging or generate 20.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
WisdomTree Emerging Markets vs. Freedom 100 Emerging
Performance |
| Timeline |
| WisdomTree Emerging |
| Freedom 100 Emerging |
WisdomTree Emerging and Freedom 100 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree Emerging and Freedom 100
The main advantage of trading using opposite WisdomTree Emerging and Freedom 100 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree Emerging position performs unexpectedly, Freedom 100 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 Freedom 100 will offset losses from the drop in Freedom 100's long position.| WisdomTree Emerging vs. WisdomTree SmallCap Dividend | WisdomTree Emerging vs. Freedom 100 Emerging | WisdomTree Emerging vs. WisdomTree High Dividend | WisdomTree Emerging vs. Invesco FTSE RAFI |
| Freedom 100 vs. WisdomTree Emerging Markets | Freedom 100 vs. WisdomTree Total Dividend | Freedom 100 vs. iShares MSCI Emerging | Freedom 100 vs. SPDR SP Bank |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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