Correlation Between WisdomTree Japan and ProShares Nasdaq
Can any of the company-specific risk be diversified away by investing in both WisdomTree Japan and ProShares Nasdaq 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 ProShares Nasdaq 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 ProShares Nasdaq 100 Dynamic, you can compare the effects of market volatilities on WisdomTree Japan and ProShares Nasdaq 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 ProShares Nasdaq. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree Japan and ProShares Nasdaq.
Diversification Opportunities for WisdomTree Japan and ProShares Nasdaq
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between WisdomTree and ProShares is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree Japan Hedged and ProShares Nasdaq 100 Dynamic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares Nasdaq 100 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 ProShares Nasdaq. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares Nasdaq 100 has no effect on the direction of WisdomTree Japan i.e., WisdomTree Japan and ProShares Nasdaq go up and down completely randomly.
Pair Corralation between WisdomTree Japan and ProShares Nasdaq
Considering the 90-day investment horizon WisdomTree Japan Hedged is expected to generate 3.62 times more return on investment than ProShares Nasdaq. However, WisdomTree Japan is 3.62 times more volatile than ProShares Nasdaq 100 Dynamic. It trades about 0.2 of its potential returns per unit of risk. ProShares Nasdaq 100 Dynamic is currently generating about 0.07 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 2,068 from holding WisdomTree Japan Hedged or generate 14.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.36% |
| Values | Daily Returns |
WisdomTree Japan Hedged vs. ProShares Nasdaq 100 Dynamic
Performance |
| Timeline |
| WisdomTree Japan Hedged |
| ProShares Nasdaq 100 |
WisdomTree Japan and ProShares Nasdaq Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree Japan and ProShares Nasdaq
The main advantage of trading using opposite WisdomTree Japan and ProShares Nasdaq positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree Japan position performs unexpectedly, ProShares Nasdaq 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 Nasdaq will offset losses from the drop in ProShares Nasdaq'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 |
| ProShares Nasdaq vs. ProShares Decline of | ProShares Nasdaq vs. Federated Hermes ETF | ProShares Nasdaq vs. WisdomTree BioRevolution | ProShares Nasdaq vs. Direxion Daily CSCO |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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