Correlation Between Kyndryl Holdings and 12513GBD0

Can any of the company-specific risk be diversified away by investing in both Kyndryl Holdings and 12513GBD0 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 12513GBD0 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Kyndryl Holdings and CDW LLC 425, you can compare the effects of market volatilities on Kyndryl Holdings and 12513GBD0 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 12513GBD0. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kyndryl Holdings and 12513GBD0.

Diversification Opportunities for Kyndryl Holdings and 12513GBD0

0.3

Correlation Coefficient

Kyndryl Holdings  12513GBD0

Weak diversification

The 3 months correlation between Kyndryl and 12513GBD0 is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Kyndryl Holdings and CDW LLC 425 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CDW LLC 425 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 12513GBD0. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CDW LLC 425 has no effect on the direction of Kyndryl Holdings i.e., Kyndryl Holdings and 12513GBD0 go up and down completely randomly.

Pair Corralation between Kyndryl Holdings and 12513GBD0

Allowing for the 90-day total investment horizon Kyndryl Holdings is expected to generate 3.39 times more return on investment than 12513GBD0. However, Kyndryl Holdings is 3.39 times more volatile than CDW LLC 425. It trades about 0.0 of its potential returns per unit of risk. CDW LLC 425 is currently generating about -0.09 per unit of risk. If you would invest  3,543  in Kyndryl Holdings on December 26, 2024 and sell it today you would lose (46.00) from holding Kyndryl Holdings or give up 1.3% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

Kyndryl Holdings  vs.  CDW LLC 425

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.

CDW LLC 425

Risk-Adjusted Performance

Weak

Over the last 90 days CDW LLC 425 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 12513GBD0 is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Kyndryl Holdings and 12513GBD0

The main advantage of trading using opposite Kyndryl Holdings and 12513GBD0 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kyndryl Holdings position performs unexpectedly, 12513GBD0 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 12513GBD0 will offset losses from the drop in 12513GBD0's long position.

The idea behind Kyndryl Holdings and CDW LLC 425 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..