Correlation Between WisdomTree Efficient and ProShares UltraShort
Can any of the company-specific risk be diversified away by investing in both WisdomTree Efficient and ProShares UltraShort 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 Efficient and ProShares UltraShort into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WisdomTree Efficient Gold and ProShares UltraShort Russell2000, you can compare the effects of market volatilities on WisdomTree Efficient and ProShares UltraShort 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 Efficient with a short position of ProShares UltraShort. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree Efficient and ProShares UltraShort.
Diversification Opportunities for WisdomTree Efficient and ProShares UltraShort
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between WisdomTree and ProShares is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree Efficient Gold and ProShares UltraShort Russell20 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares UltraShort and WisdomTree Efficient 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 Efficient Gold are associated (or correlated) with ProShares UltraShort. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares UltraShort has no effect on the direction of WisdomTree Efficient i.e., WisdomTree Efficient and ProShares UltraShort go up and down completely randomly.
Pair Corralation between WisdomTree Efficient and ProShares UltraShort
Given the investment horizon of 90 days WisdomTree Efficient Gold is expected to generate 1.97 times more return on investment than ProShares UltraShort. However, WisdomTree Efficient is 1.97 times more volatile than ProShares UltraShort Russell2000. It trades about 0.2 of its potential returns per unit of risk. ProShares UltraShort Russell2000 is currently generating about -0.13 per unit of risk. If you would invest 7,355 in WisdomTree Efficient Gold on November 6, 2025 and sell it today you would earn a total of 4,193 from holding WisdomTree Efficient Gold or generate 57.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
WisdomTree Efficient Gold vs. ProShares UltraShort Russell20
Performance |
| Timeline |
| WisdomTree Efficient Gold |
| ProShares UltraShort |
WisdomTree Efficient and ProShares UltraShort Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree Efficient and ProShares UltraShort
The main advantage of trading using opposite WisdomTree Efficient and ProShares UltraShort positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree Efficient position performs unexpectedly, ProShares UltraShort 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 UltraShort will offset losses from the drop in ProShares UltraShort's long position.| WisdomTree Efficient vs. 6 Meridian Mega | WisdomTree Efficient vs. iShares MSCI Poland | WisdomTree Efficient vs. Xtrackers MSCI Japan | WisdomTree Efficient vs. American Century Quality |
| ProShares UltraShort vs. ProShares Ultra Basic | ProShares UltraShort vs. ProShares Ultra SmallCap600 | ProShares UltraShort vs. ProShares Ultra MSCI | ProShares UltraShort vs. ProShares UltraPro MidCap400 |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |