Correlation Between Tidal Trust and WisdomTree China
Can any of the company-specific risk be diversified away by investing in both Tidal Trust and WisdomTree China 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 Tidal Trust and WisdomTree China into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tidal Trust II and WisdomTree China ex State Owned, you can compare the effects of market volatilities on Tidal Trust and WisdomTree China 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 Tidal Trust with a short position of WisdomTree China. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tidal Trust and WisdomTree China.
Diversification Opportunities for Tidal Trust and WisdomTree China
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Tidal and WisdomTree is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Tidal Trust II and WisdomTree China ex State Owne in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree China and Tidal Trust 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 Tidal Trust II are associated (or correlated) with WisdomTree China. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree China has no effect on the direction of Tidal Trust i.e., Tidal Trust and WisdomTree China go up and down completely randomly.
Pair Corralation between Tidal Trust and WisdomTree China
Given the investment horizon of 90 days Tidal Trust is expected to generate 3.24 times less return on investment than WisdomTree China. But when comparing it to its historical volatility, Tidal Trust II is 1.88 times less risky than WisdomTree China. It trades about 0.15 of its potential returns per unit of risk. WisdomTree China ex State Owned is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 3,333 in WisdomTree China ex State Owned on May 26, 2025 and sell it today you would earn a total of 688.00 from holding WisdomTree China ex State Owned or generate 20.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tidal Trust II vs. WisdomTree China ex State Owne
Performance |
| Timeline |
| Tidal Trust II |
| WisdomTree China |
Tidal Trust and WisdomTree China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tidal Trust and WisdomTree China
The main advantage of trading using opposite Tidal Trust and WisdomTree China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tidal Trust position performs unexpectedly, WisdomTree China 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 China will offset losses from the drop in WisdomTree China's long position.| Tidal Trust vs. Tidal Trust II | Tidal Trust vs. ProShares VIX Mid Term | Tidal Trust vs. ProShares VIX Short Term | Tidal Trust vs. First Trust Alternative |
| WisdomTree China vs. Global X MSCI | WisdomTree China vs. WisdomTree Emerging Markets | WisdomTree China vs. Invesco China Technology | WisdomTree China vs. iShares MSCI China |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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