Correlation Between Berkshire Hathaway and Atlantic Wind
Can any of the company-specific risk be diversified away by investing in both Berkshire Hathaway and Atlantic Wind 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 Hathaway and Atlantic Wind into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Berkshire Hathaway and Atlantic Wind Solar, you can compare the effects of market volatilities on Berkshire Hathaway and Atlantic Wind 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 Hathaway with a short position of Atlantic Wind. Check out your portfolio center. Please also check ongoing floating volatility patterns of Berkshire Hathaway and Atlantic Wind.
Diversification Opportunities for Berkshire Hathaway and Atlantic Wind
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Berkshire and Atlantic is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Berkshire Hathaway and Atlantic Wind Solar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atlantic Wind Solar and Berkshire Hathaway 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 Hathaway are associated (or correlated) with Atlantic Wind. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atlantic Wind Solar has no effect on the direction of Berkshire Hathaway i.e., Berkshire Hathaway and Atlantic Wind go up and down completely randomly.
Pair Corralation between Berkshire Hathaway and Atlantic Wind
Assuming the 90 days horizon Berkshire Hathaway is expected to generate 10.92 times less return on investment than Atlantic Wind. But when comparing it to its historical volatility, Berkshire Hathaway is 6.8 times less risky than Atlantic Wind. It trades about 0.21 of its potential returns per unit of risk. Atlantic Wind Solar is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 3.30 in Atlantic Wind Solar on November 29, 2024 and sell it today you would earn a total of 2.10 from holding Atlantic Wind Solar or generate 63.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Berkshire Hathaway vs. Atlantic Wind Solar
Performance |
| Timeline |
| Berkshire Hathaway |
| Atlantic Wind Solar |
Berkshire Hathaway and Atlantic Wind Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Berkshire Hathaway and Atlantic Wind
The main advantage of trading using opposite Berkshire Hathaway and Atlantic Wind positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Berkshire Hathaway position performs unexpectedly, Atlantic Wind 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 Atlantic Wind will offset losses from the drop in Atlantic Wind's long position.| Berkshire Hathaway vs. American International Group | Berkshire Hathaway vs. Arch Capital Group | Berkshire Hathaway vs. Sun Life Financial | Berkshire Hathaway vs. Hartford Financial Services |
| Atlantic Wind vs. Green Stream Holdings | Atlantic Wind vs. VirExit Technologies | Atlantic Wind vs. Clean Vision Corp | Atlantic Wind vs. SolarWindow Technologies |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |