Correlation Between DAX Index and Berkshire Hathaway
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By analyzing existing cross correlation between DAX Index and Berkshire Hathaway, you can compare the effects of market volatilities on DAX Index 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 DAX Index with a short position of Berkshire Hathaway. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Berkshire Hathaway.
Diversification Opportunities for DAX Index and Berkshire Hathaway
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between DAX and Berkshire is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Berkshire Hathaway in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Berkshire Hathaway and DAX Index 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 DAX Index 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 DAX Index i.e., DAX Index and Berkshire Hathaway go up and down completely randomly.
Pair Corralation between DAX Index and Berkshire Hathaway
Assuming the 90 days trading horizon DAX Index is expected to generate 31.18 times less return on investment than Berkshire Hathaway. But when comparing it to its historical volatility, DAX Index is 55.6 times less risky than Berkshire Hathaway. It trades about 0.08 of its potential returns per unit of risk. Berkshire Hathaway is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 43,400,000 in Berkshire Hathaway on August 30, 2024 and sell it today you would earn a total of 25,150,000 from holding Berkshire Hathaway or generate 57.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. Berkshire Hathaway
Performance |
| Timeline |
DAX Index and Berkshire Hathaway Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Berkshire Hathaway
Pair trading matchups for Berkshire Hathaway
Pair Trading with DAX Index and Berkshire Hathaway
The main advantage of trading using opposite DAX Index and Berkshire Hathaway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index 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.| DAX Index vs. Gladstone Investment | DAX Index vs. REINET INVESTMENTS SCA | DAX Index vs. CarsalesCom | DAX Index vs. MARKET VECTR RETAIL |
| Berkshire Hathaway vs. XLMedia PLC | Berkshire Hathaway vs. Nordic Semiconductor ASA | Berkshire Hathaway vs. REMEDY ENTERTAINMENT OYJ | Berkshire Hathaway vs. ZINC MEDIA GR |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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