Correlation Between Alithya and SEATech Ventures

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

By analyzing existing cross correlation between Alithya Group and SEATech Ventures Corp, you can compare the effects of market volatilities on Alithya and SEATech Ventures 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 SEATech Ventures. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alithya and SEATech Ventures.

Diversification Opportunities for Alithya and SEATech Ventures

-0.2

Correlation Coefficient

Alithya  SEATech Ventures

Good diversification

The 3 months correlation between Alithya and SEATech is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Alithya Group and SEATech Ventures Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEATech Ventures Corp 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 SEATech Ventures. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SEATech Ventures Corp has no effect on the direction of Alithya i.e., Alithya and SEATech Ventures go up and down completely randomly.

Pair Corralation between Alithya and SEATech Ventures

If you would invest  184.00  in Alithya Group on October 20, 2024 and sell it today you would earn a total of  0.00  from holding Alithya Group or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	5.0%
Values	Daily Returns

Alithya Group  vs.  SEATech Ventures Corp

Alithya Group

Risk-Adjusted Performance

0 of 100

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.

SEATech Ventures Corp

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SEATech Ventures Corp are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent basic indicators, SEATech Ventures showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Alithya and SEATech Ventures

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

The idea behind Alithya Group and SEATech Ventures Corp 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.