Correlation Between Kidoz and INEO Tech

Can any of the company-specific risk be diversified away by investing in both Kidoz and INEO Tech 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 Kidoz and INEO Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Kidoz Inc and INEO Tech Corp, you can compare the effects of market volatilities on Kidoz and INEO Tech 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 Kidoz with a short position of INEO Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kidoz and INEO Tech.

Diversification Opportunities for Kidoz and INEO Tech

-0.46

Correlation Coefficient

Kidoz  INEO Tech

Very good diversification

The 3 months correlation between Kidoz and INEO is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Kidoz Inc and INEO Tech Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INEO Tech Corp and Kidoz 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 Kidoz Inc are associated (or correlated) with INEO Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INEO Tech Corp has no effect on the direction of Kidoz i.e., Kidoz and INEO Tech go up and down completely randomly.

Pair Corralation between Kidoz and INEO Tech

Assuming the 90 days horizon Kidoz Inc is expected to generate 5.14 times more return on investment than INEO Tech. However, Kidoz is 5.14 times more volatile than INEO Tech Corp. It trades about 0.12 of its potential returns per unit of risk. INEO Tech Corp is currently generating about 0.02 per unit of risk. If you would invest  9.00  in Kidoz Inc on December 29, 2024 and sell it today you would earn a total of  8.00  from holding Kidoz Inc or generate 88.89% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.39%
Values	Daily Returns

Kidoz Inc  vs.  INEO Tech Corp

Kidoz Inc

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Kidoz Inc are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Kidoz reported solid returns over the last few months and may actually be approaching a breakup point.

INEO Tech Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in INEO Tech Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, INEO Tech reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Kidoz and INEO Tech

The main advantage of trading using opposite Kidoz and INEO Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kidoz position performs unexpectedly, INEO Tech 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 INEO Tech will offset losses from the drop in INEO Tech's long position.

The idea behind Kidoz Inc and INEO Tech Corp 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.