Correlation Between BigBearai Holdings and Alithya

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

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

Diversification Opportunities for BigBearai Holdings and Alithya

0.17

Correlation Coefficient

BigBearai Holdings  Alithya

Average diversification

The 3 months correlation between BigBearai and Alithya is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding BigBearai Holdings and Alithya Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alithya Group and BigBearai 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 BigBearai Holdings are associated (or correlated) with Alithya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alithya Group has no effect on the direction of BigBearai Holdings i.e., BigBearai Holdings and Alithya go up and down completely randomly.

Pair Corralation between BigBearai Holdings and Alithya

If you would invest  144.00  in BigBearai Holdings on September 2, 2024 and sell it today you would earn a total of  85.00  from holding BigBearai Holdings or generate 59.03% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

BigBearai Holdings  vs.  Alithya Group

BigBearai Holdings

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in BigBearai Holdings are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite fairly unsteady basic indicators, BigBearai Holdings demonstrated solid returns over the last few months and may actually be approaching a breakup point.

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.

Pair Trading with BigBearai Holdings and Alithya

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

The idea behind BigBearai Holdings and Alithya Group 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.