Correlation Between WisdomTree Emerging and ProShares
Can any of the company-specific risk be diversified away by investing in both WisdomTree Emerging and ProShares 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 WisdomTree Emerging and ProShares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WisdomTree Emerging Markets and ProShares SP MidCap, you can compare the effects of market volatilities on WisdomTree Emerging and ProShares 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 Emerging with a short position of ProShares. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree Emerging and ProShares.
Diversification Opportunities for WisdomTree Emerging and ProShares
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between WisdomTree and ProShares is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree Emerging Markets and ProShares SP MidCap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares SP MidCap and WisdomTree Emerging 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 Emerging Markets are associated (or correlated) with ProShares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares SP MidCap has no effect on the direction of WisdomTree Emerging i.e., WisdomTree Emerging and ProShares go up and down completely randomly.
Pair Corralation between WisdomTree Emerging and ProShares
Considering the 90-day investment horizon WisdomTree Emerging Markets is expected to generate 0.85 times more return on investment than ProShares. However, WisdomTree Emerging Markets is 1.18 times less risky than ProShares. It trades about 0.15 of its potential returns per unit of risk. ProShares SP MidCap is currently generating about 0.12 per unit of risk. If you would invest 5,639 in WisdomTree Emerging Markets on October 2, 2025 and sell it today you would earn a total of 88.00 from holding WisdomTree Emerging Markets or generate 1.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
WisdomTree Emerging Markets vs. ProShares SP MidCap
Performance |
| Timeline |
| WisdomTree Emerging |
| ProShares SP MidCap |
WisdomTree Emerging and ProShares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree Emerging and ProShares
The main advantage of trading using opposite WisdomTree Emerging and ProShares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree Emerging position performs unexpectedly, ProShares 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 ProShares will offset losses from the drop in ProShares' long position.| WisdomTree Emerging vs. WisdomTree SmallCap Dividend | WisdomTree Emerging vs. Freedom 100 Emerging | WisdomTree Emerging vs. WisdomTree High Dividend | WisdomTree Emerging vs. Invesco FTSE RAFI |
| ProShares vs. iShares Global Energy | ProShares vs. WisdomTree SmallCap Dividend | ProShares vs. WisdomTree Europe Hedged | ProShares vs. WisdomTree Trust |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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