Correlation Between Seven West and Commercial Vehicle
Can any of the company-specific risk be diversified away by investing in both Seven West and Commercial Vehicle 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 Seven West and Commercial Vehicle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Seven West Media and Commercial Vehicle Group, you can compare the effects of market volatilities on Seven West and Commercial Vehicle 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 Seven West with a short position of Commercial Vehicle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seven West and Commercial Vehicle.
Diversification Opportunities for Seven West and Commercial Vehicle
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Seven and Commercial is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Seven West Media and Commercial Vehicle Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Commercial Vehicle and Seven West 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 Seven West Media are associated (or correlated) with Commercial Vehicle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Commercial Vehicle has no effect on the direction of Seven West i.e., Seven West and Commercial Vehicle go up and down completely randomly.
Pair Corralation between Seven West and Commercial Vehicle
Assuming the 90 days horizon Seven West is expected to generate 98.39 times less return on investment than Commercial Vehicle. But when comparing it to its historical volatility, Seven West Media is 1.67 times less risky than Commercial Vehicle. It trades about 0.0 of its potential returns per unit of risk. Commercial Vehicle Group is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 138.00 in Commercial Vehicle Group on September 3, 2025 and sell it today you would earn a total of 7.00 from holding Commercial Vehicle Group or generate 5.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Seven West Media vs. Commercial Vehicle Group
Performance |
| Timeline |
| Seven West Media |
| Commercial Vehicle |
Seven West and Commercial Vehicle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Seven West and Commercial Vehicle
The main advantage of trading using opposite Seven West and Commercial Vehicle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seven West position performs unexpectedly, Commercial Vehicle 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 Commercial Vehicle will offset losses from the drop in Commercial Vehicle's long position.| Seven West vs. APPLIED MATERIALS | Seven West vs. Mitsubishi Materials | Seven West vs. Japan Tobacco | Seven West vs. URBAN OUTFITTERS |
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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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