Correlation Between Kyndryl Holdings and 235825AG1

Can any of the company-specific risk be diversified away by investing in both Kyndryl Holdings and 235825AG1 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 235825AG1 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Kyndryl Holdings and Dana 5625 percent, you can compare the effects of market volatilities on Kyndryl Holdings and 235825AG1 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 235825AG1. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kyndryl Holdings and 235825AG1.

Diversification Opportunities for Kyndryl Holdings and 235825AG1

0.49

Correlation Coefficient

Kyndryl Holdings  235825AG1

Very weak diversification

The 3 months correlation between Kyndryl and 235825AG1 is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Kyndryl Holdings and Dana 5625 percent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dana 5625 percent 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 235825AG1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dana 5625 percent has no effect on the direction of Kyndryl Holdings i.e., Kyndryl Holdings and 235825AG1 go up and down completely randomly.

Pair Corralation between Kyndryl Holdings and 235825AG1

Allowing for the 90-day total investment horizon Kyndryl Holdings is expected to generate 1.03 times less return on investment than 235825AG1. In addition to that, Kyndryl Holdings is 5.16 times more volatile than Dana 5625 percent. It trades about 0.01 of its total potential returns per unit of risk. Dana 5625 percent is currently generating about 0.06 per unit of volatility. If you would invest  9,816  in Dana 5625 percent on December 25, 2024 and sell it today you would earn a total of  160.00  from holding Dana 5625 percent or generate 1.63% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	96.72%
Values	Daily Returns

Kyndryl Holdings  vs.  Dana 5625 percent

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.

Dana 5625 percent

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Dana 5625 percent are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, 235825AG1 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 235825AG1

The main advantage of trading using opposite Kyndryl Holdings and 235825AG1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kyndryl Holdings position performs unexpectedly, 235825AG1 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 235825AG1 will offset losses from the drop in 235825AG1's long position.

The idea behind Kyndryl Holdings and Dana 5625 percent 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.