Correlation Between Kyndryl Holdings and Fidelity National

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

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

Diversification Opportunities for Kyndryl Holdings and Fidelity National

0.12

Correlation Coefficient

Kyndryl Holdings  Fidelity National

Average diversification

The 3 months correlation between Kyndryl and Fidelity is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Kyndryl Holdings and Fidelity National Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity National 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 Fidelity National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity National has no effect on the direction of Kyndryl Holdings i.e., Kyndryl Holdings and Fidelity National go up and down completely randomly.

Pair Corralation between Kyndryl Holdings and Fidelity National

Allowing for the 90-day total investment horizon Kyndryl Holdings is expected to under-perform the Fidelity National. In addition to that, Kyndryl Holdings is 1.33 times more volatile than Fidelity National Information. It trades about -0.05 of its total potential returns per unit of risk. Fidelity National Information is currently generating about -0.06 per unit of volatility. If you would invest  8,014  in Fidelity National Information on December 29, 2024 and sell it today you would lose (649.00) from holding Fidelity National Information or give up 8.1% of portfolio value over 90 days.

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

Kyndryl Holdings  vs.  Fidelity National Information

Kyndryl Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kyndryl Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Fidelity National

Risk-Adjusted Performance

Very Weak

Over the last 90 days Fidelity National Information has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's forward indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Kyndryl Holdings and Fidelity National

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

The idea behind Kyndryl Holdings and Fidelity National Information 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.