Correlation Between Direxion Daily and ProShares
Can any of the company-specific risk be diversified away by investing in both Direxion Daily and ProShares 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 Direxion Daily and ProShares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Direxion Daily Real and ProShares, you can compare the effects of market volatilities on Direxion Daily and ProShares 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 Direxion Daily with a short position of ProShares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Direxion Daily and ProShares.
Diversification Opportunities for Direxion Daily and ProShares
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Direxion and ProShares is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Direxion Daily Real and ProShares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares and Direxion Daily 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 Direxion Daily Real are associated (or correlated) with ProShares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares has no effect on the direction of Direxion Daily i.e., Direxion Daily and ProShares go up and down completely randomly.
Pair Corralation between Direxion Daily and ProShares
If you would invest (100.00) in ProShares on January 23, 2024 and sell it today you would earn a total of 100.00 from holding ProShares or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Direxion Daily Real vs. ProShares
Performance |
| Timeline |
| Direxion Daily Real |
| ProShares |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Direxion Daily and ProShares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Direxion Daily and ProShares
The main advantage of trading using opposite Direxion Daily and ProShares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Direxion Daily position performs unexpectedly, ProShares 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 will offset losses from the drop in ProShares' long position.| Direxion Daily vs. Direxion Daily Real | Direxion Daily vs. Direxion Daily MSCI | Direxion Daily vs. Direxion Daily Retail | Direxion Daily vs. Direxion Daily Healthcare |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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