Correlation Between Dimensional ETF and WisdomTree Japan
Can any of the company-specific risk be diversified away by investing in both Dimensional ETF 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 Dimensional ETF and WisdomTree Japan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dimensional ETF Trust and WisdomTree Japan Hedged, you can compare the effects of market volatilities on Dimensional ETF 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 Dimensional ETF with a short position of WisdomTree Japan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dimensional ETF and WisdomTree Japan.
Diversification Opportunities for Dimensional ETF and WisdomTree Japan
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dimensional and WisdomTree is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Dimensional ETF Trust and WisdomTree Japan Hedged in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Japan Hedged and Dimensional ETF 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 Dimensional ETF Trust 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 Hedged has no effect on the direction of Dimensional ETF i.e., Dimensional ETF and WisdomTree Japan go up and down completely randomly.
Pair Corralation between Dimensional ETF and WisdomTree Japan
Given the investment horizon of 90 days Dimensional ETF is expected to generate 4.2 times less return on investment than WisdomTree Japan. But when comparing it to its historical volatility, Dimensional ETF Trust is 1.52 times less risky than WisdomTree Japan. It trades about 0.07 of its potential returns per unit of risk. WisdomTree Japan Hedged is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 12,430 in WisdomTree Japan Hedged on August 29, 2025 and sell it today you would earn a total of 1,628 from holding WisdomTree Japan Hedged or generate 13.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
Dimensional ETF Trust vs. WisdomTree Japan Hedged
Performance |
| Timeline |
| Dimensional ETF Trust |
| WisdomTree Japan Hedged |
Dimensional ETF and WisdomTree Japan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dimensional ETF and WisdomTree Japan
The main advantage of trading using opposite Dimensional ETF and WisdomTree Japan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dimensional ETF 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.| Dimensional ETF vs. FT Vest Equity | Dimensional ETF vs. Northern Lights | Dimensional ETF vs. Diamond Hill Funds | Dimensional ETF vs. Dimensional International High |
| WisdomTree Japan vs. Aptus Defined Risk | WisdomTree Japan vs. Franklin FTSE Japan | WisdomTree Japan vs. iShares Core Aggressive | WisdomTree Japan vs. iShares Core Conservative |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges |