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WisdomTree Insights
Investors seeking to outperform equity markets often turn to stock picking or factor investing, knowingly or not. But what if there was another way—one rooted in a fundamental market dynamic rather than stock-specific characteristics?
By using the decorrelation between equity and bonds to improve its risk return efficiency, the WisdomTree Efficient Core strategy behaves like a new equity factor, enhancing returns while improving the Sharpe ratio and limiting drawdowns.
As more alternative assets become accessible and as the risk concentration at the top of equity indices increases, diversification is becoming an increasingly important component of portfolio construction. But how can assets in the portfolio can give way to such diversifiers without reducing the overall return potential?
WisdomTree's Efficient Core strategies offer an innovative and capital-efficient solution.