Correlation Between Alithya and ASGN
Can any of the company-specific risk be diversified away by investing in both Alithya and ASGN 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 ASGN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alithya Group and ASGN Inc, you can compare the effects of market volatilities on Alithya and ASGN 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 ASGN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alithya and ASGN.
Diversification Opportunities for Alithya and ASGN
Very good diversification
The 3 months correlation between Alithya and ASGN is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Alithya Group and ASGN Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASGN Inc 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 ASGN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASGN Inc has no effect on the direction of Alithya i.e., Alithya and ASGN go up and down completely randomly.
Pair Corralation between Alithya and ASGN
Given the investment horizon of 90 days Alithya Group is expected to under-perform the ASGN. In addition to that, Alithya is 1.7 times more volatile than ASGN Inc. It trades about -0.03 of its total potential returns per unit of risk. ASGN Inc is currently generating about 0.04 per unit of volatility. If you would invest 7,271 in ASGN Inc on August 31, 2024 and sell it today you would earn a total of 1,884 from holding ASGN Inc or generate 25.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 8.56% |
| Values | Daily Returns |
Alithya Group vs. ASGN Inc
Performance |
| Timeline |
| Alithya Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| ASGN Inc |
Alithya and ASGN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alithya and ASGN
The main advantage of trading using opposite Alithya and ASGN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alithya position performs unexpectedly, ASGN 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 ASGN will offset losses from the drop in ASGN's long position.| Alithya vs. Formula Systems 1985 | Alithya vs. CSP Inc | Alithya vs. Nayax | Alithya vs. Information Services Group |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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