Correlation Between Jack Henry and Kyndryl Holdings
Can any of the company-specific risk be diversified away by investing in both Jack Henry and Kyndryl Holdings 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 Jack Henry and Kyndryl Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jack Henry Associates and Kyndryl Holdings, you can compare the effects of market volatilities on Jack Henry and Kyndryl Holdings 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 Jack Henry with a short position of Kyndryl Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jack Henry and Kyndryl Holdings.
Diversification Opportunities for Jack Henry and Kyndryl Holdings
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jack and Kyndryl is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Jack Henry Associates and Kyndryl Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kyndryl Holdings and Jack Henry 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 Jack Henry Associates are associated (or correlated) with Kyndryl Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kyndryl Holdings has no effect on the direction of Jack Henry i.e., Jack Henry and Kyndryl Holdings go up and down completely randomly.
Pair Corralation between Jack Henry and Kyndryl Holdings
Given the investment horizon of 90 days Jack Henry Associates is expected to under-perform the Kyndryl Holdings. But the stock apears to be less risky and, when comparing its historical volatility, Jack Henry Associates is 2.98 times less risky than Kyndryl Holdings. The stock trades about 0.0 of its potential returns per unit of risk. The Kyndryl Holdings is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 2,280 in Kyndryl Holdings on August 31, 2024 and sell it today you would earn a total of 1,202 from holding Kyndryl Holdings or generate 52.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jack Henry Associates vs. Kyndryl Holdings
Performance |
| Timeline |
| Jack Henry Associates |
| Kyndryl Holdings |
Jack Henry and Kyndryl Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jack Henry and Kyndryl Holdings
The main advantage of trading using opposite Jack Henry and Kyndryl Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jack Henry position performs unexpectedly, Kyndryl Holdings 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 Kyndryl Holdings will offset losses from the drop in Kyndryl Holdings' long position.| Jack Henry vs. CACI International | Jack Henry vs. CDW Corp | Jack Henry vs. Broadridge Financial Solutions | Jack Henry vs. ExlService Holdings |
| Kyndryl Holdings vs. Innodata | Kyndryl Holdings vs. International Business Machines | Kyndryl Holdings vs. Aurora Innovation | Kyndryl Holdings vs. BigBearai Holdings |
Check out your portfolio center.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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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