Correlation Between QMMM Holdings and Nexxen International

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

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

Diversification Opportunities for QMMM Holdings and Nexxen International

-0.91

Correlation Coefficient

QMMM Holdings  Nexxen International

Pay attention - limited upside

The 3 months correlation between QMMM and Nexxen is -0.91. Overlapping area represents the amount of risk that can be diversified away by holding QMMM Holdings Limited and Nexxen International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nexxen International and QMMM Holdings 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 QMMM Holdings Limited are associated (or correlated) with Nexxen International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nexxen International has no effect on the direction of QMMM Holdings i.e., QMMM Holdings and Nexxen International go up and down completely randomly.

Pair Corralation between QMMM Holdings and Nexxen International

Given the investment horizon of 90 days QMMM Holdings is expected to generate 2.37 times less return on investment than Nexxen International. In addition to that, QMMM Holdings is 4.51 times more volatile than Nexxen International. It trades about 0.01 of its total potential returns per unit of risk. Nexxen International is currently generating about 0.14 per unit of volatility. If you would invest  570.00  in Nexxen International on October 9, 2024 and sell it today you would earn a total of  504.00  from holding Nexxen International or generate 88.42% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	72.12%
Values	Daily Returns

QMMM Holdings Limited  vs.  Nexxen International

QMMM Holdings Limited

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days QMMM Holdings Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's primary indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Nexxen International

Risk-Adjusted Performance

12 of 100

Good

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

Pair Trading with QMMM Holdings and Nexxen International

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

The idea behind QMMM Holdings Limited and Nexxen International 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.