Correlation Between Lindblad Expeditions and Alvotech

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

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

Diversification Opportunities for Lindblad Expeditions and Alvotech

-0.66

Correlation Coefficient

Lindblad Expeditions  Alvotech

Excellent diversification

The 3 months correlation between Lindblad and Alvotech is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Lindblad Expeditions Holdings and Alvotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alvotech and Lindblad Expeditions 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 Lindblad Expeditions Holdings are associated (or correlated) with Alvotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alvotech has no effect on the direction of Lindblad Expeditions i.e., Lindblad Expeditions and Alvotech go up and down completely randomly.

Pair Corralation between Lindblad Expeditions and Alvotech

Given the investment horizon of 90 days Lindblad Expeditions Holdings is expected to under-perform the Alvotech. In addition to that, Lindblad Expeditions is 2.08 times more volatile than Alvotech. It trades about -0.11 of its total potential returns per unit of risk. Alvotech is currently generating about 0.58 per unit of volatility. If you would invest  1,128  in Alvotech on October 8, 2024 and sell it today you would earn a total of  198.00  from holding Alvotech or generate 17.55% return on investment over 90 days.

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

Lindblad Expeditions Holdings  vs.  Alvotech

Lindblad Expeditions

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Lindblad Expeditions Holdings are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, Lindblad Expeditions exhibited solid returns over the last few months and may actually be approaching a breakup point.

Alvotech

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Alvotech are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Alvotech is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Lindblad Expeditions and Alvotech

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

The idea behind Lindblad Expeditions Holdings and Alvotech 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.