Correlation Between PUBLIC STORAGE and Berkshire Hathaway
Can any of the company-specific risk be diversified away by investing in both PUBLIC STORAGE 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 PUBLIC STORAGE and Berkshire Hathaway into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PUBLIC STORAGE PRFO and Berkshire Hathaway, you can compare the effects of market volatilities on PUBLIC STORAGE 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 PUBLIC STORAGE with a short position of Berkshire Hathaway. Check out your portfolio center. Please also check ongoing floating volatility patterns of PUBLIC STORAGE and Berkshire Hathaway.
Diversification Opportunities for PUBLIC STORAGE and Berkshire Hathaway
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PUBLIC and Berkshire is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding PUBLIC STORAGE PRFO and Berkshire Hathaway in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Berkshire Hathaway and PUBLIC STORAGE 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 PUBLIC STORAGE PRFO 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 PUBLIC STORAGE i.e., PUBLIC STORAGE and Berkshire Hathaway go up and down completely randomly.
Pair Corralation between PUBLIC STORAGE and Berkshire Hathaway
Assuming the 90 days trading horizon PUBLIC STORAGE is expected to generate 11.07 times less return on investment than Berkshire Hathaway. But when comparing it to its historical volatility, PUBLIC STORAGE PRFO is 1.0 times less risky than Berkshire Hathaway. It trades about 0.01 of its potential returns per unit of risk. Berkshire Hathaway is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 28,900 in Berkshire Hathaway on November 28, 2024 and sell it today you would earn a total of 18,760 from holding Berkshire Hathaway or generate 64.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PUBLIC STORAGE PRFO vs. Berkshire Hathaway
Performance |
| Timeline |
| PUBLIC STORAGE PRFO |
| Berkshire Hathaway |
PUBLIC STORAGE and Berkshire Hathaway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PUBLIC STORAGE and Berkshire Hathaway
The main advantage of trading using opposite PUBLIC STORAGE and Berkshire Hathaway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PUBLIC STORAGE 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.| PUBLIC STORAGE vs. National Health Investors | PUBLIC STORAGE vs. UNIDOC HEALTH P | PUBLIC STORAGE vs. EPSILON HEALTHCARE LTD | PUBLIC STORAGE vs. TAL Education Group |
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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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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