Correlation Between Intel and Direxion Daily

Can any of the company-specific risk be diversified away by investing in both Intel 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 Intel and Direxion Daily into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Intel and Direxion Daily SP, you can compare the effects of market volatilities on Intel 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 Intel with a short position of Direxion Daily. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intel and Direxion Daily.

Diversification Opportunities for Intel and Direxion Daily

-0.66

Correlation Coefficient

Intel  Direxion Daily

Excellent diversification

The 3 months correlation between Intel and Direxion is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Intel 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 Intel 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 Intel 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 Intel i.e., Intel and Direxion Daily go up and down completely randomly.

Pair Corralation between Intel and Direxion Daily

Given the investment horizon of 90 days Intel is expected to generate 0.54 times more return on investment than Direxion Daily. However, Intel is 1.84 times less risky than Direxion Daily. It trades about 0.13 of its potential returns per unit of risk. Direxion Daily SP is currently generating about -0.12 per unit of risk. If you would invest  1,884  in Intel on April 20, 2025 and sell it today you would earn a total of  426.00  from holding Intel or generate 22.61% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Intel  vs.  Direxion Daily SP

Intel

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Intel are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, Intel exhibited solid returns over the last few months and may actually be approaching a breakup point.

Direxion Daily SP

Risk-Adjusted Performance

Very Weak

Over the last 90 days Direxion Daily SP has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Etf's fundamental drivers remain rather sound which may send shares a bit higher in August 2025. The latest tumult may also be a sign of longer-term up-swing for the fund shareholders.

Pair Trading with Intel and Direxion Daily

The main advantage of trading using opposite Intel and Direxion Daily positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intel 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.

The idea behind Intel and Direxion Daily SP pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.