Correlation Between Alithya and GBT Technologies

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

By analyzing existing cross correlation between Alithya Group and GBT Technologies, you can compare the effects of market volatilities on Alithya and GBT Technologies 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 Alithya with a short position of GBT Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alithya and GBT Technologies.

Diversification Opportunities for Alithya and GBT Technologies

0.0

Correlation Coefficient

Alithya  GBT Technologies

Pay attention - limited upside

The 3 months correlation between Alithya and GBT is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Alithya Group and GBT Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GBT Technologies and Alithya 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 Alithya Group are associated (or correlated) with GBT Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GBT Technologies has no effect on the direction of Alithya i.e., Alithya and GBT Technologies go up and down completely randomly.

Pair Corralation between Alithya and GBT Technologies

If you would invest  0.04  in GBT Technologies on December 4, 2024 and sell it today you would lose (0.03) from holding GBT Technologies or give up 75.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Alithya Group  vs.  GBT Technologies

Alithya Group

Risk-Adjusted Performance

Very Weak

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

GBT Technologies

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in GBT Technologies are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak fundamental indicators, GBT Technologies demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Alithya and GBT Technologies

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

The idea behind Alithya Group and GBT Technologies 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.