Correlation Between GraniteShares 15x and Direxion Daily
Can any of the company-specific risk be diversified away by investing in both GraniteShares 15x and Direxion Daily 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 GraniteShares 15x and Direxion Daily into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GraniteShares 15x Long and Direxion Daily SP, you can compare the effects of market volatilities on GraniteShares 15x and Direxion Daily 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 GraniteShares 15x with a short position of Direxion Daily. Check out your portfolio center. Please also check ongoing floating volatility patterns of GraniteShares 15x and Direxion Daily.
Diversification Opportunities for GraniteShares 15x and Direxion Daily
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between GraniteShares and Direxion is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding GraniteShares 15x Long and Direxion Daily SP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Direxion Daily SP and GraniteShares 15x 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 GraniteShares 15x Long are associated (or correlated) with Direxion Daily. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Direxion Daily SP has no effect on the direction of GraniteShares 15x i.e., GraniteShares 15x and Direxion Daily go up and down completely randomly.
Pair Corralation between GraniteShares 15x and Direxion Daily
Given the investment horizon of 90 days GraniteShares 15x Long is expected to generate 2.25 times more return on investment than Direxion Daily. However, GraniteShares 15x is 2.25 times more volatile than Direxion Daily SP. It trades about 0.01 of its potential returns per unit of risk. Direxion Daily SP is currently generating about 0.03 per unit of risk. If you would invest 8,096 in GraniteShares 15x Long on September 12, 2024 and sell it today you would lose (1,280) from holding GraniteShares 15x Long or give up 15.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GraniteShares 15x Long vs. Direxion Daily SP
Performance |
| Timeline |
| GraniteShares 15x Long |
| Direxion Daily SP |
GraniteShares 15x and Direxion Daily Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GraniteShares 15x and Direxion Daily
The main advantage of trading using opposite GraniteShares 15x and Direxion Daily positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GraniteShares 15x position performs unexpectedly, Direxion Daily 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 Direxion Daily will offset losses from the drop in Direxion Daily's long position.| GraniteShares 15x vs. Direxion Daily MSFT | GraniteShares 15x vs. Direxion Daily GOOGL | GraniteShares 15x vs. AXS 125X NVDA | GraniteShares 15x vs. Direxion Shares ETF |
| Direxion Daily vs. Ultimus Managers Trust | Direxion Daily vs. EA Series Trust | Direxion Daily vs. Global X MLP | Direxion Daily vs. ETRACS Quarterly Pay |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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