Correlation Between Direxion Daily and PolyPeptide Group
Can any of the company-specific risk be diversified away by investing in both Direxion Daily and PolyPeptide Group 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 PolyPeptide Group 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 PolyPeptide Group AG, you can compare the effects of market volatilities on Direxion Daily and PolyPeptide Group 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 PolyPeptide Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Direxion Daily and PolyPeptide Group.
Diversification Opportunities for Direxion Daily and PolyPeptide Group
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Direxion and PolyPeptide is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Direxion Daily Mid and PolyPeptide Group AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PolyPeptide Group 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 PolyPeptide Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PolyPeptide Group has no effect on the direction of Direxion Daily i.e., Direxion Daily and PolyPeptide Group go up and down completely randomly.
Pair Corralation between Direxion Daily and PolyPeptide Group
Given the investment horizon of 90 days Direxion Daily Mid is expected to generate 0.99 times more return on investment than PolyPeptide Group. However, Direxion Daily Mid is 1.01 times less risky than PolyPeptide Group. It trades about -0.07 of its potential returns per unit of risk. PolyPeptide Group AG is currently generating about -0.16 per unit of risk. If you would invest 6,539 in Direxion Daily Mid on September 12, 2024 and sell it today you would lose (271.00) from holding Direxion Daily Mid or give up 4.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Direxion Daily Mid vs. PolyPeptide Group AG
Performance |
| Timeline |
| Direxion Daily Mid |
| PolyPeptide Group |
Direxion Daily and PolyPeptide Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Direxion Daily and PolyPeptide Group
The main advantage of trading using opposite Direxion Daily and PolyPeptide Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Direxion Daily position performs unexpectedly, PolyPeptide Group 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 PolyPeptide Group will offset losses from the drop in PolyPeptide Group'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 |
| PolyPeptide Group vs. Bachem Holding AG | PolyPeptide Group vs. Siegfried Holding | PolyPeptide Group vs. VAT Group AG | PolyPeptide Group vs. Comet Holding AG |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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