Correlation Between Direxion Daily and Xilinmen Furniture
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By analyzing existing cross correlation between Direxion Daily Mid and Xilinmen Furniture Co, you can compare the effects of market volatilities on Direxion Daily and Xilinmen Furniture 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 Xilinmen Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Direxion Daily and Xilinmen Furniture.
Diversification Opportunities for Direxion Daily and Xilinmen Furniture
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Direxion and Xilinmen is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Direxion Daily Mid and Xilinmen Furniture Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xilinmen Furniture 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 Mid are associated (or correlated) with Xilinmen Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xilinmen Furniture has no effect on the direction of Direxion Daily i.e., Direxion Daily and Xilinmen Furniture go up and down completely randomly.
Pair Corralation between Direxion Daily and Xilinmen Furniture
Given the investment horizon of 90 days Direxion Daily Mid is expected to generate 1.16 times more return on investment than Xilinmen Furniture. However, Direxion Daily is 1.16 times more volatile than Xilinmen Furniture Co. It trades about 0.09 of its potential returns per unit of risk. Xilinmen Furniture Co is currently generating about 0.02 per unit of risk. If you would invest 3,764 in Direxion Daily Mid on September 3, 2024 and sell it today you would earn a total of 2,968 from holding Direxion Daily Mid or generate 78.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.95% |
| Values | Daily Returns |
Direxion Daily Mid vs. Xilinmen Furniture Co
Performance |
| Timeline |
| Direxion Daily Mid |
| Xilinmen Furniture |
Direxion Daily and Xilinmen Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Direxion Daily and Xilinmen Furniture
The main advantage of trading using opposite Direxion Daily and Xilinmen Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Direxion Daily position performs unexpectedly, Xilinmen Furniture 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 Xilinmen Furniture will offset losses from the drop in Xilinmen Furniture's long position.| Direxion Daily vs. Direxion Daily Retail | Direxion Daily vs. Direxion Daily Industrials | Direxion Daily vs. Direxion Daily Transportation | Direxion Daily vs. Direxion Daily FTSE |
| Xilinmen Furniture vs. Tongxing Environmental Protection | Xilinmen Furniture vs. Ningbo Ligong Online | Xilinmen Furniture vs. Guangdong Advertising Co | Xilinmen Furniture vs. Bengang Steel Plates |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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