Correlation Between IShares Intermediate and WisdomTree Yield
Can any of the company-specific risk be diversified away by investing in both IShares Intermediate and WisdomTree Yield 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 IShares Intermediate and WisdomTree Yield into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Intermediate GovernmentCredit and WisdomTree Yield Enhanced, you can compare the effects of market volatilities on IShares Intermediate and WisdomTree Yield 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 IShares Intermediate with a short position of WisdomTree Yield. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Intermediate and WisdomTree Yield.
Diversification Opportunities for IShares Intermediate and WisdomTree Yield
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between IShares and WisdomTree is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding iShares Intermediate Governmen and WisdomTree Yield Enhanced in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Yield Enhanced and IShares Intermediate 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 iShares Intermediate GovernmentCredit are associated (or correlated) with WisdomTree Yield. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Yield Enhanced has no effect on the direction of IShares Intermediate i.e., IShares Intermediate and WisdomTree Yield go up and down completely randomly.
Pair Corralation between IShares Intermediate and WisdomTree Yield
Considering the 90-day investment horizon iShares Intermediate GovernmentCredit is expected to generate 1.42 times more return on investment than WisdomTree Yield. However, IShares Intermediate is 1.42 times more volatile than WisdomTree Yield Enhanced. It trades about 0.18 of its potential returns per unit of risk. WisdomTree Yield Enhanced is currently generating about 0.24 per unit of risk. If you would invest 10,570 in iShares Intermediate GovernmentCredit on August 21, 2025 and sell it today you would earn a total of 161.00 from holding iShares Intermediate GovernmentCredit or generate 1.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Intermediate Governmen vs. WisdomTree Yield Enhanced
Performance |
| Timeline |
| iShares Intermediate |
| WisdomTree Yield Enhanced |
IShares Intermediate and WisdomTree Yield Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Intermediate and WisdomTree Yield
The main advantage of trading using opposite IShares Intermediate and WisdomTree Yield positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Intermediate position performs unexpectedly, WisdomTree Yield 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 Yield will offset losses from the drop in WisdomTree Yield's long position.| IShares Intermediate vs. SPDR Series Trust | IShares Intermediate vs. iShares GovernmentCredit Bond | IShares Intermediate vs. Xtrackers USD High | IShares Intermediate vs. iShares ESG Aggregate |
| WisdomTree Yield vs. WisdomTree Interest Rate | WisdomTree Yield vs. Brookstone Ultra Short Bond | WisdomTree Yield vs. Columbia Short Duration | WisdomTree Yield vs. Bondbloxx ETF Trust |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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