Correlation Between IShares VII and WisdomTree

Can any of the company-specific risk be diversified away by investing in both IShares VII and WisdomTree 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 VII and WisdomTree into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between iShares VII Public and WisdomTree, you can compare the effects of market volatilities on IShares VII and WisdomTree 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 VII with a short position of WisdomTree. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares VII and WisdomTree.

Diversification Opportunities for IShares VII and WisdomTree

0.0

Correlation Coefficient

IShares VII  WisdomTree

Pay attention - limited upside

The 3 months correlation between IShares and WisdomTree is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding iShares VII Public and WisdomTree in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree and IShares VII 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 VII Public are associated (or correlated) with WisdomTree. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree has no effect on the direction of IShares VII i.e., IShares VII and WisdomTree go up and down completely randomly.

Pair Corralation between IShares VII and WisdomTree

If you would invest  115,299  in iShares VII Public on May 9, 2025 and sell it today you would earn a total of  18,031  from holding iShares VII Public or generate 15.64% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

iShares VII Public  vs.  WisdomTree

iShares VII Public

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in iShares VII Public are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. Despite nearly unfluctuating basic indicators, IShares VII reported solid returns over the last few months and may actually be approaching a breakup point.

WisdomTree

Risk-Adjusted Performance

Weakest

Over the last 90 days WisdomTree has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, WisdomTree is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with IShares VII and WisdomTree

The main advantage of trading using opposite IShares VII and WisdomTree positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares VII position performs unexpectedly, WisdomTree 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 will offset losses from the drop in WisdomTree's long position.

The idea behind iShares VII Public and WisdomTree pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.