Correlation Between Direxion Daily and SOUTHERN
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By analyzing existing cross correlation between Direxion Daily Mid and SOUTHERN CALIFORNIA EDISON, you can compare the effects of market volatilities on Direxion Daily and SOUTHERN 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 SOUTHERN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Direxion Daily and SOUTHERN.
Diversification Opportunities for Direxion Daily and SOUTHERN
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Direxion and SOUTHERN is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Direxion Daily Mid and SOUTHERN CALIFORNIA EDISON in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SOUTHERN CALIFORNIA 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 SOUTHERN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SOUTHERN CALIFORNIA has no effect on the direction of Direxion Daily i.e., Direxion Daily and SOUTHERN go up and down completely randomly.
Pair Corralation between Direxion Daily and SOUTHERN
Given the investment horizon of 90 days Direxion Daily Mid is expected to generate 1.84 times more return on investment than SOUTHERN. However, Direxion Daily is 1.84 times more volatile than SOUTHERN CALIFORNIA EDISON. It trades about 0.28 of its potential returns per unit of risk. SOUTHERN CALIFORNIA EDISON is currently generating about -0.1 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 Against |
| Strength | Insignificant |
| Accuracy | 72.73% |
| Values | Daily Returns |
Direxion Daily Mid vs. SOUTHERN CALIFORNIA EDISON
Performance |
| Timeline |
| Direxion Daily Mid |
| SOUTHERN CALIFORNIA |
Direxion Daily and SOUTHERN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Direxion Daily and SOUTHERN
The main advantage of trading using opposite Direxion Daily and SOUTHERN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Direxion Daily position performs unexpectedly, SOUTHERN 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 SOUTHERN will offset losses from the drop in SOUTHERN'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 |
| SOUTHERN vs. ServiceNow | SOUTHERN vs. Grupo Simec SAB | SOUTHERN vs. Kaiser Aluminum | SOUTHERN vs. SmartStop Self Storage |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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