A Case Study in Persistence-Aware Alpha
How ConvexityIQ™ Classified DDL as Carry Before a +19% Repricing December 2025
Executive Summary
In mid-December 2025, Dingdong (Cayman) Ltd. (DDL) began a sharp upside repricing, advancing more than +19% from the level at which ConvexityIQ™ had already classified the underlying as Carry. The move appeared sudden on the chart, but from a structural convexity perspective, it was neither random nor unexpected.
As of December 18, 2025, DDL was explicitly identified by the ConvexityIQ™ engine as a Carry-regime underlying at approximately $2.61, despite muted near-term returns and deeply negative longer-window ROI. What followed was not a volatility event or a regime transition, but the delayed realization of stored convexity that had already survived time, drawdown, and decay.
This case reinforces a core ConvexityIQ™ principle:
Alpha is not defined by recent performance.
It is defined by persistence.
The Market’s View vs. the Structural Reality
Conventional Interpretation
From a traditional lens, DDL appeared unremarkable at the time of identification:
Flat short-term returns
No momentum confirmation
Negative long-window ROI
No obvious catalyst
To many participants, DDL looked dormant at best — damaged at worst.
Convexity-Persistence Interpretation
From a ConvexityIQ™ perspective, the same conditions told a different story:
Convexity had survived drawdown
α-Half-Life remained extended
Structure remained ridge-qualified
Decay dynamics favored harvesting, not collapse
The distinction matters. One view reacts to price. The other explains why price can move at all.
