Correlation Between VanEck International and WisdomTree International
Can any of the company-specific risk be diversified away by investing in both VanEck International and WisdomTree International 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 VanEck International and WisdomTree International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VanEck International High and WisdomTree International Multifactor, you can compare the effects of market volatilities on VanEck International and WisdomTree International 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 VanEck International with a short position of WisdomTree International. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck International and WisdomTree International.
Diversification Opportunities for VanEck International and WisdomTree International
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between VanEck and WisdomTree is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding VanEck International High and WisdomTree International Multi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree International and VanEck International 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 VanEck International High are associated (or correlated) with WisdomTree International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree International has no effect on the direction of VanEck International i.e., VanEck International and WisdomTree International go up and down completely randomly.
Pair Corralation between VanEck International and WisdomTree International
Considering the 90-day investment horizon VanEck International High is expected to generate 0.65 times more return on investment than WisdomTree International. However, VanEck International High is 1.55 times less risky than WisdomTree International. It trades about 0.14 of its potential returns per unit of risk. WisdomTree International Multifactor is currently generating about 0.06 per unit of risk. If you would invest 2,137 in VanEck International High on June 3, 2025 and sell it today you would earn a total of 76.00 from holding VanEck International High or generate 3.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
VanEck International High vs. WisdomTree International Multi
Performance |
| Timeline |
| VanEck International High |
| WisdomTree International |
VanEck International and WisdomTree International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VanEck International and WisdomTree International
The main advantage of trading using opposite VanEck International and WisdomTree International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VanEck International position performs unexpectedly, WisdomTree International 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 International will offset losses from the drop in WisdomTree International's long position.| VanEck International vs. VanEck Emerging Markets | VanEck International vs. iShares International High | VanEck International vs. iShares Intl High | VanEck International vs. iShares JP Morgan |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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