Correlation Between ProShares Ultra and WisdomTree Emerging
Can any of the company-specific risk be diversified away by investing in both ProShares Ultra and WisdomTree Emerging 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 ProShares Ultra and WisdomTree Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares Ultra QQQ and WisdomTree Emerging Markets, you can compare the effects of market volatilities on ProShares Ultra and WisdomTree Emerging 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 ProShares Ultra with a short position of WisdomTree Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Ultra and WisdomTree Emerging.
Diversification Opportunities for ProShares Ultra and WisdomTree Emerging
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ProShares and WisdomTree is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Ultra QQQ and WisdomTree Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Emerging and ProShares Ultra 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 ProShares Ultra QQQ are associated (or correlated) with WisdomTree Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Emerging has no effect on the direction of ProShares Ultra i.e., ProShares Ultra and WisdomTree Emerging go up and down completely randomly.
Pair Corralation between ProShares Ultra and WisdomTree Emerging
Considering the 90-day investment horizon ProShares Ultra QQQ is expected to generate 2.42 times more return on investment than WisdomTree Emerging. However, ProShares Ultra is 2.42 times more volatile than WisdomTree Emerging Markets. It trades about 0.11 of its potential returns per unit of risk. WisdomTree Emerging Markets is currently generating about 0.14 per unit of risk. If you would invest 5,779 in ProShares Ultra QQQ on September 29, 2025 and sell it today you would earn a total of 1,489 from holding ProShares Ultra QQQ or generate 25.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProShares Ultra QQQ vs. WisdomTree Emerging Markets
Performance |
| Timeline |
| ProShares Ultra QQQ |
| WisdomTree Emerging |
ProShares Ultra and WisdomTree Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Ultra and WisdomTree Emerging
The main advantage of trading using opposite ProShares Ultra and WisdomTree Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Ultra position performs unexpectedly, WisdomTree Emerging 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 WisdomTree Emerging will offset losses from the drop in WisdomTree Emerging's long position.| ProShares Ultra vs. Invesco SP 500 | ProShares Ultra vs. Dimensional International Core | ProShares Ultra vs. iShares Expanded Tech Software | ProShares Ultra vs. Vanguard Mega Cap |
| WisdomTree Emerging vs. WisdomTree Emerging Markets | WisdomTree Emerging vs. First Trust RiverFront | WisdomTree Emerging vs. KraneShares California Carbon | WisdomTree Emerging vs. First Trust Small |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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