Correlation Between WisdomTree Japan and Fidelity MSCI
Can any of the company-specific risk be diversified away by investing in both WisdomTree Japan and Fidelity MSCI 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 Japan and Fidelity MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WisdomTree Japan Hedged and Fidelity MSCI Financials, you can compare the effects of market volatilities on WisdomTree Japan and Fidelity MSCI 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 Japan with a short position of Fidelity MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree Japan and Fidelity MSCI.
Diversification Opportunities for WisdomTree Japan and Fidelity MSCI
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between WisdomTree and Fidelity is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree Japan Hedged and Fidelity MSCI Financials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity MSCI Financials and WisdomTree Japan 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 Japan Hedged are associated (or correlated) with Fidelity MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity MSCI Financials has no effect on the direction of WisdomTree Japan i.e., WisdomTree Japan and Fidelity MSCI go up and down completely randomly.
Pair Corralation between WisdomTree Japan and Fidelity MSCI
Considering the 90-day investment horizon WisdomTree Japan Hedged is expected to generate 1.08 times more return on investment than Fidelity MSCI. However, WisdomTree Japan is 1.08 times more volatile than Fidelity MSCI Financials. It trades about 0.21 of its potential returns per unit of risk. Fidelity MSCI Financials is currently generating about -0.05 per unit of risk. If you would invest 14,013 in WisdomTree Japan Hedged on December 4, 2025 and sell it today you would earn a total of 2,224 from holding WisdomTree Japan Hedged or generate 15.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
WisdomTree Japan Hedged vs. Fidelity MSCI Financials
Performance |
| Timeline |
| WisdomTree Japan Hedged |
| Fidelity MSCI Financials |
WisdomTree Japan and Fidelity MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree Japan and Fidelity MSCI
The main advantage of trading using opposite WisdomTree Japan and Fidelity MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree Japan position performs unexpectedly, Fidelity MSCI 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 Fidelity MSCI will offset losses from the drop in Fidelity MSCI's long position.| WisdomTree Japan vs. Pacer Small Cap | WisdomTree Japan vs. WisdomTree MidCap Dividend | WisdomTree Japan vs. iShares Financials ETF | WisdomTree Japan vs. SPDR SP 600 |
| Fidelity MSCI vs. iShares Industrials ETF | Fidelity MSCI vs. iShares Consumer Discretionary | Fidelity MSCI vs. iShares Utilities ETF | Fidelity MSCI vs. iShares Russell 2500 |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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