Correlation Between ProShares Short and Direxion Daily
Can any of the company-specific risk be diversified away by investing in both ProShares Short 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 ProShares Short and Direxion Daily into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProShares Short QQQ and Direxion Daily GOOGL, you can compare the effects of market volatilities on ProShares Short 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 ProShares Short with a short position of Direxion Daily. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProShares Short and Direxion Daily.
Diversification Opportunities for ProShares Short and Direxion Daily
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ProShares and Direxion is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding ProShares Short QQQ and Direxion Daily GOOGL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Direxion Daily GOOGL and ProShares Short 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 Short QQQ 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 GOOGL has no effect on the direction of ProShares Short i.e., ProShares Short and Direxion Daily go up and down completely randomly.
Pair Corralation between ProShares Short and Direxion Daily
Considering the 90-day investment horizon ProShares Short QQQ is expected to under-perform the Direxion Daily. But the etf apears to be less risky and, when comparing its historical volatility, ProShares Short QQQ is 3.98 times less risky than Direxion Daily. The etf trades about -0.05 of its potential returns per unit of risk. The Direxion Daily GOOGL is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest 4,622 in Direxion Daily GOOGL on August 22, 2025 and sell it today you would earn a total of 4,314 from holding Direxion Daily GOOGL or generate 93.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProShares Short QQQ vs. Direxion Daily GOOGL
Performance |
| Timeline |
| ProShares Short QQQ |
| Direxion Daily GOOGL |
ProShares Short and Direxion Daily Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProShares Short and Direxion Daily
The main advantage of trading using opposite ProShares Short and Direxion Daily positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProShares Short 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.| ProShares Short vs. ProShares UltraPro Short | ProShares Short vs. ProShares UltraShort SP500 | ProShares Short vs. ProShares UltraShort QQQ | ProShares Short vs. Direxion Daily Junior |
| Direxion Daily vs. Direxion Daily AMZN | Direxion Daily vs. MicroSectors FANG ETN | Direxion Daily vs. REX FANG Innovation | Direxion Daily vs. VanEck Pharmaceutical ETF |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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