Correlation Between ProShares Bitcoin and Direxion Shares
Can any of the company-specific risk be diversified away by investing in both ProShares Bitcoin and Direxion Shares 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 ProShares Bitcoin and Direxion Shares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares Bitcoin Strategy and Direxion Shares ETF, you can compare the effects of market volatilities on ProShares Bitcoin and Direxion Shares 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 ProShares Bitcoin with a short position of Direxion Shares. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Bitcoin and Direxion Shares.
Diversification Opportunities for ProShares Bitcoin and Direxion Shares
-0.92 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ProShares and Direxion is -0.92. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Bitcoin Strategy and Direxion Shares ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Direxion Shares ETF and ProShares Bitcoin 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 ProShares Bitcoin Strategy are associated (or correlated) with Direxion Shares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Direxion Shares ETF has no effect on the direction of ProShares Bitcoin i.e., ProShares Bitcoin and Direxion Shares go up and down completely randomly.
Pair Corralation between ProShares Bitcoin and Direxion Shares
Given the investment horizon of 90 days ProShares Bitcoin Strategy is expected to generate 0.52 times more return on investment than Direxion Shares. However, ProShares Bitcoin Strategy is 1.93 times less risky than Direxion Shares. It trades about 0.16 of its potential returns per unit of risk. Direxion Shares ETF is currently generating about -0.1 per unit of risk. If you would invest 1,600 in ProShares Bitcoin Strategy on March 10, 2025 and sell it today you would earn a total of 492.00 from holding ProShares Bitcoin Strategy or generate 30.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProShares Bitcoin Strategy vs. Direxion Shares ETF
Performance |
| Timeline |
| ProShares Bitcoin |
| Direxion Shares ETF |
ProShares Bitcoin and Direxion Shares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Bitcoin and Direxion Shares
The main advantage of trading using opposite ProShares Bitcoin and Direxion Shares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Bitcoin position performs unexpectedly, Direxion Shares 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 Shares will offset losses from the drop in Direxion Shares' long position.| ProShares Bitcoin vs. Grayscale Bitcoin Trust | ProShares Bitcoin vs. Grayscale Ethereum Trust | ProShares Bitcoin vs. Coinbase Global | ProShares Bitcoin vs. Valkyrie Bitcoin Strategy |
| Direxion Shares vs. Direxion Shares ETF | Direxion Shares vs. Direxion Shares ETF | Direxion Shares vs. Direxion Shares ETF | Direxion Shares vs. AXS TSLA Bear |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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