Correlation Between Kyndryl Holdings and Fiserv,

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

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

Diversification Opportunities for Kyndryl Holdings and Fiserv,

0.75

Correlation Coefficient

Kyndryl Holdings  Fiserv,

Poor diversification

The 3 months correlation between Kyndryl and Fiserv, is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Kyndryl Holdings and Fiserv, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fiserv, and Kyndryl 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 Kyndryl Holdings are associated (or correlated) with Fiserv,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fiserv, has no effect on the direction of Kyndryl Holdings i.e., Kyndryl Holdings and Fiserv, go up and down completely randomly.

Pair Corralation between Kyndryl Holdings and Fiserv,

Allowing for the 90-day total investment horizon Kyndryl Holdings is expected to generate 2.51 times more return on investment than Fiserv,. However, Kyndryl Holdings is 2.51 times more volatile than Fiserv,. It trades about 0.1 of its potential returns per unit of risk. Fiserv, is currently generating about 0.15 per unit of risk. If you would invest  1,588  in Kyndryl Holdings on September 12, 2024 and sell it today you would earn a total of  1,924  from holding Kyndryl Holdings or generate 121.16% return on investment over 90 days.

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

Kyndryl Holdings  vs.  Fiserv,

Kyndryl Holdings

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Kyndryl Holdings are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating fundamental indicators, Kyndryl Holdings exhibited solid returns over the last few months and may actually be approaching a breakup point.

Fiserv,

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Fiserv, are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Fiserv, demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Kyndryl Holdings and Fiserv,

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

The idea behind Kyndryl Holdings and Fiserv, 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.