This module allows you to analyze existing cross correlation between WisdomTree India Earnings ETF and Facebook. You can compare the effects of market volatilities on WisdomTree India and Facebook 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 India with a short position of Facebook. See also your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree India and Facebook.
Considering 30-days investment horizon, WisdomTree India Earnings ETF is expected to under-perform the Facebook. But the etf apears to be less risky and, when comparing its historical volatility, WisdomTree India Earnings ETF is 1.32 times less risky than Facebook. The etf trades about -0.01 of its potential returns per unit of risk. The Facebook is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 20,174 in Facebook on June 22, 2018 and sell it today you would earn a total of 820.00 from holding Facebook or generate 4.06% return on investment over 30 days.
Pair Corralation between WisdomTree India and Facebook
Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree India Earnings ETF and Facebook Inc in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Facebook and WisdomTree India 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 India Earnings ETF are associated (or correlated) with Facebook. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Facebook has no effect on the direction of WisdomTree India i.e. WisdomTree India and Facebook go up and down completely randomly.
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