Correlation Between Kidoz and QMMM Holdings

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

By analyzing existing cross correlation between Kidoz Inc and QMMM Holdings Limited, you can compare the effects of market volatilities on Kidoz and QMMM Holdings 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 QMMM Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kidoz and QMMM Holdings.

Diversification Opportunities for Kidoz and QMMM Holdings

0.53

Correlation Coefficient

Kidoz  QMMM Holdings

Very weak diversification

The 3 months correlation between Kidoz and QMMM is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Kidoz Inc and QMMM Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QMMM Holdings Limited 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 QMMM Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QMMM Holdings Limited has no effect on the direction of Kidoz i.e., Kidoz and QMMM Holdings go up and down completely randomly.

Pair Corralation between Kidoz and QMMM Holdings

Assuming the 90 days horizon Kidoz Inc is expected to generate 5.77 times more return on investment than QMMM Holdings. However, Kidoz is 5.77 times more volatile than QMMM Holdings Limited. It trades about 0.13 of its potential returns per unit of risk. QMMM Holdings Limited is currently generating about 0.16 per unit of risk. If you would invest  9.00  in Kidoz Inc on December 19, 2024 and sell it today you would earn a total of  9.00  from holding Kidoz Inc or generate 100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Kidoz Inc  vs.  QMMM Holdings Limited

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.

QMMM Holdings Limited

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in QMMM Holdings Limited are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain primary indicators, QMMM Holdings displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Kidoz and QMMM Holdings

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

The idea behind Kidoz Inc and QMMM Holdings Limited 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.