Correlation Between CATLIN GROUP and Berkshire Hathaway
Can any of the company-specific risk be diversified away by investing in both CATLIN GROUP and Berkshire Hathaway 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 CATLIN GROUP and Berkshire Hathaway into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CATLIN GROUP and Berkshire Hathaway, you can compare the effects of market volatilities on CATLIN GROUP and Berkshire Hathaway 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 CATLIN GROUP with a short position of Berkshire Hathaway. Check out your portfolio center. Please also check ongoing floating volatility patterns of CATLIN GROUP and Berkshire Hathaway.
Diversification Opportunities for CATLIN GROUP and Berkshire Hathaway
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CATLIN and Berkshire is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CATLIN GROUP and Berkshire Hathaway in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Berkshire Hathaway and CATLIN GROUP 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 CATLIN GROUP are associated (or correlated) with Berkshire Hathaway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Berkshire Hathaway has no effect on the direction of CATLIN GROUP i.e., CATLIN GROUP and Berkshire Hathaway go up and down completely randomly.
Pair Corralation between CATLIN GROUP and Berkshire Hathaway
If you would invest 32,350 in Berkshire Hathaway on January 20, 2025 and sell it today you would earn a total of 19,700 from holding Berkshire Hathaway or generate 60.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.2% |
| Values | Daily Returns |
CATLIN GROUP vs. Berkshire Hathaway
Performance |
| Timeline |
| CATLIN GROUP |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| Berkshire Hathaway |
CATLIN GROUP and Berkshire Hathaway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CATLIN GROUP and Berkshire Hathaway
The main advantage of trading using opposite CATLIN GROUP and Berkshire Hathaway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CATLIN GROUP position performs unexpectedly, Berkshire Hathaway 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 Berkshire Hathaway will offset losses from the drop in Berkshire Hathaway's long position.| CATLIN GROUP vs. GCP Infrastructure Investments | CATLIN GROUP vs. Alfa Financial Software | CATLIN GROUP vs. Auction Technology Group | CATLIN GROUP vs. Tavistock Investments Plc |
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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 Transaction History module to view history of all your transactions and understand their impact on performance.
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