Correlation Between Berkshire Hathaway and Mapletree Logistics
Can any of the company-specific risk be diversified away by investing in both Berkshire Hathaway and Mapletree Logistics 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 Mapletree Logistics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Berkshire Hathaway and Mapletree Logistics Trust, you can compare the effects of market volatilities on Berkshire Hathaway and Mapletree Logistics 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 Mapletree Logistics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Berkshire Hathaway and Mapletree Logistics.
Diversification Opportunities for Berkshire Hathaway and Mapletree Logistics
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Berkshire and Mapletree is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Berkshire Hathaway and Mapletree Logistics Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mapletree Logistics Trust 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 Mapletree Logistics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mapletree Logistics Trust has no effect on the direction of Berkshire Hathaway i.e., Berkshire Hathaway and Mapletree Logistics go up and down completely randomly.
Pair Corralation between Berkshire Hathaway and Mapletree Logistics
Assuming the 90 days horizon Berkshire Hathaway is expected to generate 0.32 times more return on investment than Mapletree Logistics. However, Berkshire Hathaway is 3.15 times less risky than Mapletree Logistics. It trades about 0.11 of its potential returns per unit of risk. Mapletree Logistics Trust is currently generating about 0.02 per unit of risk. If you would invest 62,740,000 in Berkshire Hathaway on August 29, 2024 and sell it today you would earn a total of 9,614,900 from holding Berkshire Hathaway or generate 15.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 97.62% |
| Values | Daily Returns |
Berkshire Hathaway vs. Mapletree Logistics Trust
Performance |
| Timeline |
| Berkshire Hathaway |
| Mapletree Logistics Trust |
Berkshire Hathaway and Mapletree Logistics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Berkshire Hathaway and Mapletree Logistics
The main advantage of trading using opposite Berkshire Hathaway and Mapletree Logistics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Berkshire Hathaway position performs unexpectedly, Mapletree Logistics 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 Mapletree Logistics will offset losses from the drop in Mapletree Logistics' 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 |
| Mapletree Logistics vs. CapitaLand Investment Limited | Mapletree Logistics vs. Cumberland Pharmaceuticals | Mapletree Logistics vs. Comstock Holding Companies | Mapletree Logistics vs. Viemed Healthcare |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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