Correlation Between Direxion Daily and Gigante Salmon
Can any of the company-specific risk be diversified away by investing in both Direxion Daily and Gigante Salmon 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 Gigante Salmon 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 Gigante Salmon AS, you can compare the effects of market volatilities on Direxion Daily and Gigante Salmon 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 Gigante Salmon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Direxion Daily and Gigante Salmon.
Diversification Opportunities for Direxion Daily and Gigante Salmon
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Direxion and Gigante is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Direxion Daily Mid and Gigante Salmon AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gigante Salmon AS 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 Gigante Salmon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gigante Salmon AS has no effect on the direction of Direxion Daily i.e., Direxion Daily and Gigante Salmon go up and down completely randomly.
Pair Corralation between Direxion Daily and Gigante Salmon
Given the investment horizon of 90 days Direxion Daily Mid is expected to under-perform the Gigante Salmon. But the etf apears to be less risky and, when comparing its historical volatility, Direxion Daily Mid is 1.24 times less risky than Gigante Salmon. The etf trades about -0.07 of its potential returns per unit of risk. The Gigante Salmon AS is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 842.00 in Gigante Salmon AS on September 12, 2024 and sell it today you would lose (26.00) from holding Gigante Salmon AS or give up 3.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Direxion Daily Mid vs. Gigante Salmon AS
Performance |
| Timeline |
| Direxion Daily Mid |
| Gigante Salmon AS |
Direxion Daily and Gigante Salmon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Direxion Daily and Gigante Salmon
The main advantage of trading using opposite Direxion Daily and Gigante Salmon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Direxion Daily position performs unexpectedly, Gigante Salmon 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 Gigante Salmon will offset losses from the drop in Gigante Salmon'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 |
| Gigante Salmon vs. Andfjord Salmon AS | Gigante Salmon vs. Salmon Evolution Holding | Gigante Salmon vs. Biofish Holding AS | Gigante Salmon vs. Nordic Aqua 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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