Correlation Between Clear Media and Berkshire Hathaway

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Can any of the company-specific risk be diversified away by investing in both Clear Media 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 Clear Media and Berkshire Hathaway into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Clear Media Limited and Berkshire Hathaway, you can compare the effects of market volatilities on Clear Media 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 Clear Media with a short position of Berkshire Hathaway. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clear Media and Berkshire Hathaway.

Diversification Opportunities for Clear Media and Berkshire Hathaway

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  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Clear and Berkshire is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Clear Media Limited and Berkshire Hathaway in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Berkshire Hathaway and Clear Media 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 Clear Media Limited 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 Clear Media i.e., Clear Media and Berkshire Hathaway go up and down completely randomly.

Pair Corralation between Clear Media and Berkshire Hathaway

If you would invest  61,730,000  in Berkshire Hathaway on December 29, 2023 and sell it today you would earn a total of  1,231,000  from holding Berkshire Hathaway or generate 1.99% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Clear Media Limited  vs.  Berkshire Hathaway

 Performance 
       Timeline  
Clear Media Limited 

Risk-Adjusted Performance

0 of 100

 
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High
Very Weak
Over the last 90 days Clear Media Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable essential indicators, Clear Media is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.
Berkshire Hathaway 

Risk-Adjusted Performance

24 of 100

 
Low
 
High
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Berkshire Hathaway are ranked lower than 24 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady basic indicators, Berkshire Hathaway sustained solid returns over the last few months and may actually be approaching a breakup point.

Clear Media and Berkshire Hathaway Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Clear Media and Berkshire Hathaway

The main advantage of trading using opposite Clear Media and Berkshire Hathaway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clear Media 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.
The idea behind Clear Media Limited and Berkshire Hathaway pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Global Correlations module to find global opportunities by holding instruments from different markets.

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