Correlation Between Fm Investments and WisdomTree Japan
Can any of the company-specific risk be diversified away by investing in both Fm Investments and WisdomTree Japan 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 Fm Investments and WisdomTree Japan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fm Investments and WisdomTree Japan SmallCap, you can compare the effects of market volatilities on Fm Investments and WisdomTree Japan 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 Fm Investments with a short position of WisdomTree Japan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fm Investments and WisdomTree Japan.
Diversification Opportunities for Fm Investments and WisdomTree Japan
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between XFIX and WisdomTree is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Fm Investments and WisdomTree Japan SmallCap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Japan SmallCap and Fm Investments 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 Fm Investments are associated (or correlated) with WisdomTree Japan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Japan SmallCap has no effect on the direction of Fm Investments i.e., Fm Investments and WisdomTree Japan go up and down completely randomly.
Pair Corralation between Fm Investments and WisdomTree Japan
Given the investment horizon of 90 days Fm Investments is expected to generate 12.89 times less return on investment than WisdomTree Japan. But when comparing it to its historical volatility, Fm Investments is 12.72 times less risky than WisdomTree Japan. It trades about 0.37 of its potential returns per unit of risk. WisdomTree Japan SmallCap is currently generating about 0.37 of returns per unit of risk over similar time horizon. If you would invest 9,016 in WisdomTree Japan SmallCap on November 18, 2025 and sell it today you would earn a total of 2,069 from holding WisdomTree Japan SmallCap or generate 22.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 50.0% |
| Values | Daily Returns |
Fm Investments vs. WisdomTree Japan SmallCap
Performance |
| Timeline |
| Fm Investments |
Risk-Adjusted Performance
Strong
Weak | Strong |
| WisdomTree Japan SmallCap |
Fm Investments and WisdomTree Japan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fm Investments and WisdomTree Japan
The main advantage of trading using opposite Fm Investments and WisdomTree Japan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fm Investments position performs unexpectedly, WisdomTree Japan 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 Japan will offset losses from the drop in WisdomTree Japan's long position.| Fm Investments vs. Trueshares Structured Outcome | Fm Investments vs. Vaneck ETF Trust | Fm Investments vs. Spinnaker ETF Series | Fm Investments vs. Federated Hermes ETF |
| WisdomTree Japan vs. WisdomTree SmallCap Quality | WisdomTree Japan vs. iShares MSCI Indonesia | WisdomTree Japan vs. WisdomTree Cloud Computing | WisdomTree Japan vs. Davis Select Financial |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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