Correlation Between United Rentals and Berkshire Hathaway
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By analyzing existing cross correlation between United Rentals and Berkshire Hathaway, you can compare the effects of market volatilities on United Rentals 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 United Rentals with a short position of Berkshire Hathaway. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Rentals and Berkshire Hathaway.
Diversification Opportunities for United Rentals and Berkshire Hathaway
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between United and Berkshire is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding United Rentals and Berkshire Hathaway in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Berkshire Hathaway and United Rentals 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 United Rentals 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 United Rentals i.e., United Rentals and Berkshire Hathaway go up and down completely randomly.
Pair Corralation between United Rentals and Berkshire Hathaway
Assuming the 90 days horizon United Rentals is expected to generate 2.56 times more return on investment than Berkshire Hathaway. However, United Rentals is 2.56 times more volatile than Berkshire Hathaway. It trades about 0.06 of its potential returns per unit of risk. Berkshire Hathaway is currently generating about 0.09 per unit of risk. If you would invest 40,942 in United Rentals on October 29, 2024 and sell it today you would earn a total of 34,198 from holding United Rentals or generate 83.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
United Rentals vs. Berkshire Hathaway
Performance |
| Timeline |
| United Rentals |
| Berkshire Hathaway |
United Rentals and Berkshire Hathaway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Rentals and Berkshire Hathaway
The main advantage of trading using opposite United Rentals and Berkshire Hathaway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Rentals 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.| United Rentals vs. The Hanover Insurance | United Rentals vs. Zurich Insurance Group | United Rentals vs. Mobilezone Holding AG | United Rentals vs. Highlight Communications AG |
| Berkshire Hathaway vs. AECOM TECHNOLOGY | Berkshire Hathaway vs. Firan Technology Group | Berkshire Hathaway vs. Wayside Technology Group | Berkshire Hathaway vs. Nordic Semiconductor ASA |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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