Correlation Between Direxion and SPDR Kensho
Can any of the company-specific risk be diversified away by investing in both Direxion and SPDR Kensho 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 and SPDR Kensho into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Direxion and SPDR Kensho Clean, you can compare the effects of market volatilities on Direxion and SPDR Kensho 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 with a short position of SPDR Kensho. Check out your portfolio center. Please also check ongoing floating volatility patterns of Direxion and SPDR Kensho.
Diversification Opportunities for Direxion and SPDR Kensho
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Direxion and SPDR is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Direxion and SPDR Kensho Clean in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR Kensho Clean and Direxion 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 are associated (or correlated) with SPDR Kensho. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR Kensho Clean has no effect on the direction of Direxion i.e., Direxion and SPDR Kensho go up and down completely randomly.
Pair Corralation between Direxion and SPDR Kensho
If you would invest 36.00 in Direxion on November 3, 2024 and sell it today you would earn a total of 0.00 from holding Direxion or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 5.0% |
| Values | Daily Returns |
Direxion vs. SPDR Kensho Clean
Performance |
| Timeline |
| Direxion |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| SPDR Kensho Clean |
Direxion and SPDR Kensho Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Direxion and SPDR Kensho
The main advantage of trading using opposite Direxion and SPDR Kensho positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Direxion position performs unexpectedly, SPDR Kensho 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 SPDR Kensho will offset losses from the drop in SPDR Kensho's long position.| Direxion vs. SPDR Kensho New | Direxion vs. The 3D Printing | Direxion vs. Invesco NASDAQ Next | Direxion vs. ARK Space Exploration |
| SPDR Kensho vs. ALPS Clean Energy | SPDR Kensho vs. VanEck Low Carbon | SPDR Kensho vs. Invesco Global Clean | SPDR Kensho vs. SPDR Kensho New |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |