BW - A Case Study in Persistence-Aware Alpha
How ConvexityIQ™ Classified BW as Carry Before a +34.8% Repricing (December 2025)
Executive Summary
In late-December 2025, Babcock & Wilcox Enterprises, Inc. (BW) began a decisive upside repricing, advancing +34.8% from the level at which ConvexityIQ™ had already classified the underlying as Carry-regime convexity. The move appeared abrupt on the chart, but from a structural convexity perspective, it was neither random nor surprising.
As of December 18, 2025, BW was explicitly identified by the ConvexityIQ™ engine as a Carry-qualified underlying at approximately $4.62, despite muted short-term returns and the absence of momentum confirmation. By December 30, BW traded at $6.21, resolving stored convexity that had already survived time, drawdown, and decay.
This case reinforces a central 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, BW appeared unremarkable at the time of identification:
Flat near-term returns
No momentum breakout
No volatility expansion
No visible catalyst
To many participants, BW looked dormant — a name to ignore while “faster” ideas rotated through.
Convexity-Persistence Interpretation
From a ConvexityIQ™ perspective, the same conditions told a different story:
