Correlation Between Direxion Daily and Banco Santander
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By analyzing existing cross correlation between Direxion Daily Mid and Banco Santander SA, you can compare the effects of market volatilities on Direxion Daily and Banco Santander 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 Banco Santander. Check out your portfolio center. Please also check ongoing floating volatility patterns of Direxion Daily and Banco Santander.
Diversification Opportunities for Direxion Daily and Banco Santander
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Direxion and Banco is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Direxion Daily Mid and Banco Santander SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banco Santander SA 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 Banco Santander. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Banco Santander SA has no effect on the direction of Direxion Daily i.e., Direxion Daily and Banco Santander go up and down completely randomly.
Pair Corralation between Direxion Daily and Banco Santander
Given the investment horizon of 90 days Direxion Daily Mid is expected to generate 2.12 times more return on investment than Banco Santander. However, Direxion Daily is 2.12 times more volatile than Banco Santander SA. It trades about 0.28 of its potential returns per unit of risk. Banco Santander SA is currently generating about -0.09 per unit of risk. If you would invest 5,385 in Direxion Daily Mid on September 5, 2024 and sell it today you would earn a total of 1,235 from holding Direxion Daily Mid or generate 22.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Direxion Daily Mid vs. Banco Santander SA
Performance |
| Timeline |
| Direxion Daily Mid |
| Banco Santander SA |
Direxion Daily and Banco Santander Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Direxion Daily and Banco Santander
The main advantage of trading using opposite Direxion Daily and Banco Santander positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Direxion Daily position performs unexpectedly, Banco Santander 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 Banco Santander will offset losses from the drop in Banco Santander'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 |
| Banco Santander vs. JPMorgan Chase Co | Banco Santander vs. HSBC Holdings plc | Banco Santander vs. ING Groep NV |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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