Correlation Between Direxion Daily and Allergan Plc
Can any of the company-specific risk be diversified away by investing in both Direxion Daily and Allergan Plc 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 Allergan Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Direxion Daily Mid and Allergan Plc, you can compare the effects of market volatilities on Direxion Daily and Allergan Plc 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 Allergan Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Direxion Daily and Allergan Plc.
Diversification Opportunities for Direxion Daily and Allergan Plc
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Direxion and Allergan is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Direxion Daily Mid and Allergan Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allergan Plc 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 Allergan Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allergan Plc has no effect on the direction of Direxion Daily i.e., Direxion Daily and Allergan Plc go up and down completely randomly.
Pair Corralation between Direxion Daily and Allergan Plc
If you would invest 5,385 in Direxion Daily Mid on September 3, 2024 and sell it today you would earn a total of 1,347 from holding Direxion Daily Mid or generate 25.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Direxion Daily Mid vs. Allergan Plc
Performance |
| Timeline |
| Direxion Daily Mid |
| Allergan Plc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Direxion Daily and Allergan Plc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Direxion Daily and Allergan Plc
The main advantage of trading using opposite Direxion Daily and Allergan Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Direxion Daily position performs unexpectedly, Allergan Plc 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 Allergan Plc will offset losses from the drop in Allergan Plc'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 |
| Allergan Plc vs. Empresa Distribuidora y | Allergan Plc vs. The Gap, | Allergan Plc vs. SunLink Health Systems | Allergan Plc vs. Cheniere Energy Partners |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |