Correlation Between WisdomTree Managed and Defiance Large
Can any of the company-specific risk be diversified away by investing in both WisdomTree Managed and Defiance Large 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 Managed and Defiance Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WisdomTree Managed Futures and Defiance Large Cap, you can compare the effects of market volatilities on WisdomTree Managed and Defiance Large 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 Managed with a short position of Defiance Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree Managed and Defiance Large.
Diversification Opportunities for WisdomTree Managed and Defiance Large
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between WisdomTree and Defiance is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree Managed Futures and Defiance Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Defiance Large Cap and WisdomTree Managed 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 Managed Futures are associated (or correlated) with Defiance Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Defiance Large Cap has no effect on the direction of WisdomTree Managed i.e., WisdomTree Managed and Defiance Large go up and down completely randomly.
Pair Corralation between WisdomTree Managed and Defiance Large
Given the investment horizon of 90 days WisdomTree Managed is expected to generate 2.24 times less return on investment than Defiance Large. But when comparing it to its historical volatility, WisdomTree Managed Futures is 1.04 times less risky than Defiance Large. It trades about 0.07 of its potential returns per unit of risk. Defiance Large Cap is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 2,177 in Defiance Large Cap on November 19, 2025 and sell it today you would earn a total of 143.00 from holding Defiance Large Cap or generate 6.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 98.36% |
| Values | Daily Returns |
WisdomTree Managed Futures vs. Defiance Large Cap
Performance |
| Timeline |
| WisdomTree Managed |
| Defiance Large Cap |
WisdomTree Managed and Defiance Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree Managed and Defiance Large
The main advantage of trading using opposite WisdomTree Managed and Defiance Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree Managed position performs unexpectedly, Defiance Large 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 Defiance Large will offset losses from the drop in Defiance Large's long position.| WisdomTree Managed vs. Elevation Series Trust | WisdomTree Managed vs. Exchange Traded Concepts | WisdomTree Managed vs. Innovator MSCI EAFE | WisdomTree Managed vs. VanEck Inflation Allocation |
| Defiance Large vs. Touchstone ETF Trust | Defiance Large vs. Siren Nasdaq NexGen | Defiance Large vs. Madison ETFs Trust | Defiance Large vs. Listed Funds 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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