Correlation Between Berkshire Hills and Public Storage
Can any of the company-specific risk be diversified away by investing in both Berkshire Hills and Public Storage 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 Berkshire Hills and Public Storage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Berkshire Hills Bancorp and Public Storage, you can compare the effects of market volatilities on Berkshire Hills and Public Storage 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 Berkshire Hills with a short position of Public Storage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Berkshire Hills and Public Storage.
Diversification Opportunities for Berkshire Hills and Public Storage
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Berkshire and Public is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Berkshire Hills Bancorp and Public Storage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Public Storage and Berkshire Hills 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 Berkshire Hills Bancorp are associated (or correlated) with Public Storage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Public Storage has no effect on the direction of Berkshire Hills i.e., Berkshire Hills and Public Storage go up and down completely randomly.
Pair Corralation between Berkshire Hills and Public Storage
Assuming the 90 days horizon Berkshire Hills Bancorp is expected to generate 3.42 times more return on investment than Public Storage. However, Berkshire Hills is 3.42 times more volatile than Public Storage. It trades about 0.05 of its potential returns per unit of risk. Public Storage is currently generating about -0.04 per unit of risk. If you would invest 2,802 in Berkshire Hills Bancorp on September 12, 2024 and sell it today you would earn a total of 78.00 from holding Berkshire Hills Bancorp or generate 2.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Berkshire Hills Bancorp vs. Public Storage
Performance |
| Timeline |
| Berkshire Hills Bancorp |
| Public Storage |
Berkshire Hills and Public Storage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Berkshire Hills and Public Storage
The main advantage of trading using opposite Berkshire Hills and Public Storage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Berkshire Hills position performs unexpectedly, Public Storage 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 Public Storage will offset losses from the drop in Public Storage's long position.| Berkshire Hills vs. ACCSYS TECHPLC EO | Berkshire Hills vs. PKSHA TECHNOLOGY INC | Berkshire Hills vs. Dalata Hotel Group | Berkshire Hills vs. Hyatt Hotels |
| Public Storage vs. BROADSTNET LEADL 00025 | Public Storage vs. CARSALESCOM | Public Storage vs. TEXAS ROADHOUSE | Public Storage vs. TRAINLINE PLC LS |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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