Correlation Between Direxion Daily and Intouch Insight

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Can any of the company-specific risk be diversified away by investing in both Direxion Daily and Intouch Insight 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 Intouch Insight into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Direxion Daily Semiconductor and Intouch Insight, you can compare the effects of market volatilities on Direxion Daily and Intouch Insight 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 Intouch Insight. Check out your portfolio center. Please also check ongoing floating volatility patterns of Direxion Daily and Intouch Insight.

Diversification Opportunities for Direxion Daily and Intouch Insight

0.66
  Correlation Coefficient

Poor diversification

The 3 months correlation between Direxion and Intouch is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Direxion Daily Semiconductor and Intouch Insight in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intouch Insight 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 Semiconductor are associated (or correlated) with Intouch Insight. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intouch Insight has no effect on the direction of Direxion Daily i.e., Direxion Daily and Intouch Insight go up and down completely randomly.

Pair Corralation between Direxion Daily and Intouch Insight

Given the investment horizon of 90 days Direxion Daily Semiconductor is expected to under-perform the Intouch Insight. In addition to that, Direxion Daily is 1.36 times more volatile than Intouch Insight. It trades about -0.24 of its total potential returns per unit of risk. Intouch Insight is currently generating about -0.03 per unit of volatility. If you would invest  32.00  in Intouch Insight on May 3, 2025 and sell it today you would lose (3.00) from holding Intouch Insight or give up 9.38% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Direxion Daily Semiconductor  vs.  Intouch Insight

 Performance 
       Timeline  
Direxion Daily Semic 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Direxion Daily Semiconductor has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Etf's basic indicators remain comparatively stable which may send shares a bit higher in September 2025. The newest uproar may also be a sign of mid-term up-swing for the exchange-traded fund private investors.
Intouch Insight 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Intouch Insight has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Intouch Insight is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Direxion Daily and Intouch Insight Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Direxion Daily and Intouch Insight

The main advantage of trading using opposite Direxion Daily and Intouch Insight positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Direxion Daily position performs unexpectedly, Intouch Insight 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 Intouch Insight will offset losses from the drop in Intouch Insight's long position.
The idea behind Direxion Daily Semiconductor and Intouch Insight 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.

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