Correlation Between Kyndryl Holdings and Veeco Instruments
Can any of the company-specific risk be diversified away by investing in both Kyndryl Holdings and Veeco Instruments 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 Veeco Instruments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kyndryl Holdings and Veeco Instruments, you can compare the effects of market volatilities on Kyndryl Holdings and Veeco Instruments 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 Veeco Instruments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kyndryl Holdings and Veeco Instruments.
Diversification Opportunities for Kyndryl Holdings and Veeco Instruments
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kyndryl and Veeco is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Kyndryl Holdings and Veeco Instruments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Veeco Instruments 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 Veeco Instruments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Veeco Instruments has no effect on the direction of Kyndryl Holdings i.e., Kyndryl Holdings and Veeco Instruments go up and down completely randomly.
Pair Corralation between Kyndryl Holdings and Veeco Instruments
Allowing for the 90-day total investment horizon Kyndryl Holdings is expected to generate 1.1 times more return on investment than Veeco Instruments. However, Kyndryl Holdings is 1.1 times more volatile than Veeco Instruments. It trades about 0.1 of its potential returns per unit of risk. Veeco Instruments is currently generating about 0.01 per unit of risk. If you would invest 1,891 in Kyndryl Holdings on September 4, 2024 and sell it today you would earn a total of 1,587 from holding Kyndryl Holdings or generate 83.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kyndryl Holdings vs. Veeco Instruments
Performance |
| Timeline |
| Kyndryl Holdings |
| Veeco Instruments |
Kyndryl Holdings and Veeco Instruments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kyndryl Holdings and Veeco Instruments
The main advantage of trading using opposite Kyndryl Holdings and Veeco Instruments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kyndryl Holdings position performs unexpectedly, Veeco Instruments 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 Veeco Instruments will offset losses from the drop in Veeco Instruments' long position.| Kyndryl Holdings vs. EPAM Systems | Kyndryl Holdings vs. Infosys Ltd ADR | Kyndryl Holdings vs. Cognizant Technology Solutions | Kyndryl Holdings vs. FiscalNote Holdings |
| Veeco Instruments vs. NVE Corporation | Veeco Instruments vs. Photronics | Veeco Instruments vs. Kulicke and Soffa | Veeco Instruments vs. Alvarium Tiedemann 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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