Correlation Between Berkshire Hathaway and Clifton Mining
Can any of the company-specific risk be diversified away by investing in both Berkshire Hathaway and Clifton Mining 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 Clifton Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Berkshire Hathaway and Clifton Mining Co, you can compare the effects of market volatilities on Berkshire Hathaway and Clifton Mining 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 Clifton Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Berkshire Hathaway and Clifton Mining.
Diversification Opportunities for Berkshire Hathaway and Clifton Mining
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Berkshire and Clifton is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Berkshire Hathaway and Clifton Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clifton Mining 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 Clifton Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clifton Mining has no effect on the direction of Berkshire Hathaway i.e., Berkshire Hathaway and Clifton Mining go up and down completely randomly.
Pair Corralation between Berkshire Hathaway and Clifton Mining
Assuming the 90 days horizon Berkshire Hathaway is expected to generate 1.22 times less return on investment than Clifton Mining. But when comparing it to its historical volatility, Berkshire Hathaway is 4.07 times less risky than Clifton Mining. It trades about 0.19 of its potential returns per unit of risk. Clifton Mining Co is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 5.00 in Clifton Mining Co on August 30, 2024 and sell it today you would earn a total of 0.20 from holding Clifton Mining Co or generate 4.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Berkshire Hathaway vs. Clifton Mining Co
Performance |
| Timeline |
| Berkshire Hathaway |
| Clifton Mining |
Berkshire Hathaway and Clifton Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Berkshire Hathaway and Clifton Mining
The main advantage of trading using opposite Berkshire Hathaway and Clifton Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Berkshire Hathaway position performs unexpectedly, Clifton Mining 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 Clifton Mining will offset losses from the drop in Clifton Mining's long position.| Berkshire Hathaway vs. Invesco High Income | Berkshire Hathaway vs. Blackrock Muniholdings Ny | Berkshire Hathaway vs. Nuveen California Select | Berkshire Hathaway vs. MFS Investment Grade |
| Clifton Mining vs. Cartier Iron Corp | Clifton Mining vs. Arctic Star Exploration | Clifton Mining vs. Capella Minerals Limited | Clifton Mining vs. Denarius Silver Corp |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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