This paper addresses some of the performance issues associated with performing the wavelet transform (WT) using the joint transform correlator (JTC), specifically the phase-only JTC (POJTC). The current POJTC architecture, called the POWJTC, utilizes a single liquid crystal television (LCTV) as a spatial light modulator (SLM) operating only on the phase of the incident coherent light. Many JTC-based WT architectures have used hard-clipped bandpass filters as wavelet functions, filtering the joint transform power spectrum (JTPS) to enhance the correlation SNR for two inputs (not including the wavelet). It has been demonstrated that, by encoding the wavelet and the object to be analyzed in the input plane of the POJTC, a true WT, in the sense that the WT is a correlation integral, can be achieved. However, the correlation output contains many more terms than the normal amplitude-only JTC (AOJTC) that may affect the performance, and there are restrictions associated with this encoding process. A mathematical description based on scalar fields, accompanied by simulations and experimental results, is presented.