Correlation Between Kyndryl Holdings and Tri-ContinentalPFD

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

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

Diversification Opportunities for Kyndryl Holdings and Tri-ContinentalPFD

-0.31

Correlation Coefficient

Kyndryl Holdings  Tri-ContinentalPFD

Very good diversification

The 3 months correlation between Kyndryl and Tri-ContinentalPFD is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Kyndryl Holdings and Tri Continental PFD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tri Continental PFD 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 Tri-ContinentalPFD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tri Continental PFD has no effect on the direction of Kyndryl Holdings i.e., Kyndryl Holdings and Tri-ContinentalPFD go up and down completely randomly.

Pair Corralation between Kyndryl Holdings and Tri-ContinentalPFD

Allowing for the 90-day total investment horizon Kyndryl Holdings is expected to generate 2.32 times less return on investment than Tri-ContinentalPFD. In addition to that, Kyndryl Holdings is 4.1 times more volatile than Tri Continental PFD. It trades about 0.0 of its total potential returns per unit of risk. Tri Continental PFD is currently generating about 0.04 per unit of volatility. If you would invest  4,438  in Tri Continental PFD on December 25, 2024 and sell it today you would earn a total of  53.00  from holding Tri Continental PFD or generate 1.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.33%
Values	Daily Returns

Kyndryl Holdings  vs.  Tri Continental PFD

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 rather sound fundamental indicators, Kyndryl Holdings is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Tri Continental PFD

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Tri Continental PFD are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Tri-ContinentalPFD is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Kyndryl Holdings and Tri-ContinentalPFD

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

The idea behind Kyndryl Holdings and Tri Continental PFD 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.