Correlation Between Alight and Open Lending

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

By analyzing existing cross correlation between Alight Inc and Open Lending Corp, you can compare the effects of market volatilities on Alight and Open Lending 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 Alight with a short position of Open Lending. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alight and Open Lending.

Diversification Opportunities for Alight and Open Lending

0.13

Correlation Coefficient

Alight  Open Lending

Average diversification

The 3 months correlation between Alight and Open is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Alight Inc and Open Lending Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Open Lending Corp and Alight 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 Alight Inc are associated (or correlated) with Open Lending. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Open Lending Corp has no effect on the direction of Alight i.e., Alight and Open Lending go up and down completely randomly.

Pair Corralation between Alight and Open Lending

Given the investment horizon of 90 days Alight Inc is expected to under-perform the Open Lending. But the stock apears to be less risky and, when comparing its historical volatility, Alight Inc is 1.3 times less risky than Open Lending. The stock trades about -0.2 of its potential returns per unit of risk. The Open Lending Corp is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  200.00  in Open Lending Corp on May 13, 2025 and sell it today you would earn a total of  23.00  from holding Open Lending Corp or generate 11.5% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Alight Inc  vs.  Open Lending Corp

Alight Inc

Risk-Adjusted Performance

Weakest

Over the last 90 days Alight Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's forward indicators remain comparatively stable which may send shares a bit higher in September 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Open Lending Corp

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Open Lending Corp are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain basic indicators, Open Lending displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Alight and Open Lending

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

The idea behind Alight Inc and Open Lending 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.