Correlation Between Nordic Semiconductor and Berkshire Hathaway
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By analyzing existing cross correlation between Nordic Semiconductor ASA and Berkshire Hathaway, you can compare the effects of market volatilities on Nordic Semiconductor 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 Nordic Semiconductor with a short position of Berkshire Hathaway. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nordic Semiconductor and Berkshire Hathaway.
Diversification Opportunities for Nordic Semiconductor and Berkshire Hathaway
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Nordic and Berkshire is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Nordic Semiconductor ASA and Berkshire Hathaway in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Berkshire Hathaway and Nordic Semiconductor 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 Nordic Semiconductor ASA 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 Nordic Semiconductor i.e., Nordic Semiconductor and Berkshire Hathaway go up and down completely randomly.
Pair Corralation between Nordic Semiconductor and Berkshire Hathaway
Assuming the 90 days horizon Nordic Semiconductor ASA is expected to generate 1.75 times more return on investment than Berkshire Hathaway. However, Nordic Semiconductor is 1.75 times more volatile than Berkshire Hathaway. It trades about 0.11 of its potential returns per unit of risk. Berkshire Hathaway is currently generating about 0.11 per unit of risk. If you would invest 887.00 in Nordic Semiconductor ASA on November 7, 2024 and sell it today you would earn a total of 40.00 from holding Nordic Semiconductor ASA or generate 4.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nordic Semiconductor ASA vs. Berkshire Hathaway
Performance |
| Timeline |
| Nordic Semiconductor ASA |
| Berkshire Hathaway |
Nordic Semiconductor and Berkshire Hathaway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nordic Semiconductor and Berkshire Hathaway
The main advantage of trading using opposite Nordic Semiconductor and Berkshire Hathaway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nordic Semiconductor 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.| Nordic Semiconductor vs. NVIDIA | Nordic Semiconductor vs. NVIDIA | Nordic Semiconductor vs. Taiwan Semiconductor Manufacturing | Nordic Semiconductor vs. Texas Instruments Incorporated |
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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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