Correlation Between Direxion Daily and Schibsted ASA
Can any of the company-specific risk be diversified away by investing in both Direxion Daily and Schibsted ASA 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 Schibsted ASA 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 Schibsted ASA A, you can compare the effects of market volatilities on Direxion Daily and Schibsted ASA 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 Schibsted ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Direxion Daily and Schibsted ASA.
Diversification Opportunities for Direxion Daily and Schibsted ASA
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Direxion and Schibsted is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Direxion Daily Mid and Schibsted ASA A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schibsted ASA A 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 Schibsted ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schibsted ASA A has no effect on the direction of Direxion Daily i.e., Direxion Daily and Schibsted ASA go up and down completely randomly.
Pair Corralation between Direxion Daily and Schibsted ASA
Given the investment horizon of 90 days Direxion Daily is expected to generate 1.2 times less return on investment than Schibsted ASA. But when comparing it to its historical volatility, Direxion Daily Mid is 1.16 times less risky than Schibsted ASA. It trades about 0.09 of its potential returns per unit of risk. Schibsted ASA A is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,333 in Schibsted ASA A on September 4, 2024 and sell it today you would earn a total of 1,821 from holding Schibsted ASA A or generate 136.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.97% |
| Values | Daily Returns |
Direxion Daily Mid vs. Schibsted ASA A
Performance |
| Timeline |
| Direxion Daily Mid |
| Schibsted ASA A |
Direxion Daily and Schibsted ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Direxion Daily and Schibsted ASA
The main advantage of trading using opposite Direxion Daily and Schibsted ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Direxion Daily position performs unexpectedly, Schibsted ASA 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 Schibsted ASA will offset losses from the drop in Schibsted ASA'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 |
| Schibsted ASA vs. Superior Plus Corp | Schibsted ASA vs. NMI Holdings | Schibsted ASA vs. Origin Agritech | Schibsted ASA vs. SIVERS SEMICONDUCTORS AB |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |