Boosting Efficiency in the Core

September 10, 2021

What is an Efficient Core Fund and how does it differ from traditional equity strategies? Our approach seeks to boost risk-adjusted returns by leveraging the historical relationship between stocks and bonds. Watch this video to learn more about the development of WisdomTree's Efficient Core Funds and how they can help diversify your portfolio while providing upside potential during bull markets, with lower volatility and smaller drawdowns during market corrections.

Every investor walks the risk-reward tightrope. Lean one way, and you can negatively impact the other—especially during changing market cycles. For many investors, the sweet spot has long been the 60/40 portfolio allocation: 60% equities to build capital, 40% fixed income to mitigate risk. Building on this time-tested approach to asset allocation, WisdomTree has created a suite of Efficient Core Funds that seek to provide the upside of equity markets while helping to reduce volatility and drawdowns.


Instead of allocating to stocks and bonds like the traditional approach, the Efficient Core approach combines beta exposure to equities with an overlay of U.S. Treasury futures. By combining these assets in a single portfolio, our Efficient Core family of Funds seeks to meaningfully boost the risk efficiency, with some potential tax benefits as well.


No hedge is perfect, of course. But when equities decline, U.S. Treasury prices have historically tended to increase. We believe this gives your overall portfolio more diversification and upside potential during bull markets, with lower volatility and greater risk-adjusted returns. The WisdomTree Efficient Core suite began with a focus on the U.S. large-cap market through the WisdomTree U.S. Efficient Core Fund, ticker NTSX. We then expanded the offering across developed international and emerging markets by adding the WisdomTree International Efficient Core Fund (NTSI) and the WisdomTree Emerging Markets Efficient Core Fund (NTSE).


Consider this suite of Efficient Core Funds when seeking greater risk-adjusted returns in your portfolio. Visit or speak to a WisdomTree representative to learn more.



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