Correlation Between NYSE Composite and Kyndryl Holdings
Can any of the company-specific risk be diversified away by investing in both NYSE Composite 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 NYSE Composite and Kyndryl Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Kyndryl Holdings, you can compare the effects of market volatilities on NYSE Composite 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 NYSE Composite with a short position of Kyndryl Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Kyndryl Holdings.
Diversification Opportunities for NYSE Composite and Kyndryl Holdings
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between NYSE and Kyndryl is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Kyndryl Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kyndryl Holdings and NYSE Composite 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 NYSE Composite 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 NYSE Composite i.e., NYSE Composite and Kyndryl Holdings go up and down completely randomly.
Pair Corralation between NYSE Composite and Kyndryl Holdings
Assuming the 90 days trading horizon NYSE Composite is expected to generate 3.59 times less return on investment than Kyndryl Holdings. But when comparing it to its historical volatility, NYSE Composite is 4.58 times less risky than Kyndryl Holdings. It trades about 0.21 of its potential returns per unit of risk. Kyndryl Holdings is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 3,826 in Kyndryl Holdings on November 18, 2024 and sell it today you would earn a total of 353.00 from holding Kyndryl Holdings or generate 9.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Kyndryl Holdings
Performance |
| Timeline |
NYSE Composite and Kyndryl Holdings Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Kyndryl Holdings
Pair trading matchups for Kyndryl Holdings
Pair Trading with NYSE Composite and Kyndryl Holdings
The main advantage of trading using opposite NYSE Composite and Kyndryl Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite 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.| NYSE Composite vs. Zhihu Inc ADR | NYSE Composite vs. Allied Gaming Entertainment | NYSE Composite vs. Asure Software | NYSE Composite vs. SohuCom |
| Kyndryl Holdings vs. Organon Co | Kyndryl Holdings vs. Warner Bros Discovery | Kyndryl Holdings vs. Viatris | Kyndryl Holdings vs. GE HealthCare Technologies |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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