Correlation Between OOhMedia and Seven West
Can any of the company-specific risk be diversified away by investing in both OOhMedia and Seven West 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 OOhMedia and Seven West into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between oOhMedia and Seven West Media, you can compare the effects of market volatilities on OOhMedia and Seven West 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 OOhMedia with a short position of Seven West. Check out your portfolio center. Please also check ongoing floating volatility patterns of OOhMedia and Seven West.
Diversification Opportunities for OOhMedia and Seven West
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between OOhMedia and Seven is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding oOhMedia and Seven West Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seven West Media and OOhMedia 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 oOhMedia are associated (or correlated) with Seven West. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seven West Media has no effect on the direction of OOhMedia i.e., OOhMedia and Seven West go up and down completely randomly.
Pair Corralation between OOhMedia and Seven West
Assuming the 90 days trading horizon oOhMedia is expected to generate 0.61 times more return on investment than Seven West. However, oOhMedia is 1.63 times less risky than Seven West. It trades about -0.02 of its potential returns per unit of risk. Seven West Media is currently generating about -0.03 per unit of risk. If you would invest 139.00 in oOhMedia on August 27, 2024 and sell it today you would lose (17.00) from holding oOhMedia or give up 12.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
oOhMedia vs. Seven West Media
Performance |
| Timeline |
| oOhMedia |
| Seven West Media |
OOhMedia and Seven West Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OOhMedia and Seven West
The main advantage of trading using opposite OOhMedia and Seven West positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OOhMedia position performs unexpectedly, Seven West 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 Seven West will offset losses from the drop in Seven West's long position.| OOhMedia vs. Aneka Tambang Tbk | OOhMedia vs. Commonwealth Bank | OOhMedia vs. Commonwealth Bank of | OOhMedia vs. Australia and New |
| Seven West vs. Gtn | Seven West vs. Dynamic Drill And | Seven West vs. Insignia Financial | Seven West vs. G8 Education |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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