Correlation Between Direxion Daily and Barclays Capital
Can any of the company-specific risk be diversified away by investing in both Direxion Daily and Barclays Capital 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 Barclays Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Direxion Daily 7 10 and Barclays Capital, you can compare the effects of market volatilities on Direxion Daily and Barclays Capital 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 Barclays Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Direxion Daily and Barclays Capital.
Diversification Opportunities for Direxion Daily and Barclays Capital
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Direxion and Barclays is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Direxion Daily 7 10 and Barclays Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barclays Capital 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 7 10 are associated (or correlated) with Barclays Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barclays Capital has no effect on the direction of Direxion Daily i.e., Direxion Daily and Barclays Capital go up and down completely randomly.
Pair Corralation between Direxion Daily and Barclays Capital
If you would invest 2,507 in Direxion Daily 7 10 on September 3, 2024 and sell it today you would earn a total of 53.00 from holding Direxion Daily 7 10 or generate 2.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Direxion Daily 7 10 vs. Barclays Capital
Performance |
| Timeline |
| Direxion Daily 7 |
| Barclays Capital |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Direxion Daily and Barclays Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Direxion Daily and Barclays Capital
The main advantage of trading using opposite Direxion Daily and Barclays Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Direxion Daily position performs unexpectedly, Barclays Capital 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 Barclays Capital will offset losses from the drop in Barclays Capital's long position.| Direxion Daily vs. ProShares Ultra MSCI | Direxion Daily vs. ProShares Ultra Euro | Direxion Daily vs. ProShares Ultra High | Direxion Daily vs. ProShares Ultra FTSE |
| Barclays Capital vs. Direxion Daily 7 10 | Barclays Capital vs. Direxion Daily 20 | Barclays Capital vs. Direxion Daily MSCI | Barclays Capital vs. Direxion Daily Real |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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