Correlation Between WisdomTree Managed and ProShares Large
Can any of the company-specific risk be diversified away by investing in both WisdomTree Managed and ProShares Large 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 Managed and ProShares Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WisdomTree Managed Futures and ProShares Large Cap, you can compare the effects of market volatilities on WisdomTree Managed and ProShares Large 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 Managed with a short position of ProShares Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree Managed and ProShares Large.
Diversification Opportunities for WisdomTree Managed and ProShares Large
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between WisdomTree and ProShares is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree Managed Futures and ProShares Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares Large Cap and WisdomTree Managed 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 Managed Futures are associated (or correlated) with ProShares Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares Large Cap has no effect on the direction of WisdomTree Managed i.e., WisdomTree Managed and ProShares Large go up and down completely randomly.
Pair Corralation between WisdomTree Managed and ProShares Large
Given the investment horizon of 90 days WisdomTree Managed is expected to generate 2.11 times less return on investment than ProShares Large. But when comparing it to its historical volatility, WisdomTree Managed Futures is 1.21 times less risky than ProShares Large. It trades about 0.2 of its potential returns per unit of risk. ProShares Large Cap is currently generating about 0.36 of returns per unit of risk over similar time horizon. If you would invest 7,720 in ProShares Large Cap on September 25, 2025 and sell it today you would earn a total of 322.00 from holding ProShares Large Cap or generate 4.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
WisdomTree Managed Futures vs. ProShares Large Cap
Performance |
| Timeline |
| WisdomTree Managed |
| ProShares Large Cap |
WisdomTree Managed and ProShares Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree Managed and ProShares Large
The main advantage of trading using opposite WisdomTree Managed and ProShares Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree Managed position performs unexpectedly, ProShares Large 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 Large will offset losses from the drop in ProShares Large's long position.| WisdomTree Managed vs. Invesco BuyBack Achievers | WisdomTree Managed vs. Vanguard SP Small Cap | WisdomTree Managed vs. iShares Broker Dealers Securities | WisdomTree Managed vs. Simplify Exchange Traded |
| ProShares Large vs. ProShares Ultra Dow30 | ProShares Large vs. Invesco Actively Managed | ProShares Large vs. FlexShares Quality Dividend | ProShares Large vs. iShares ESG Screened |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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