Correlation Between Lindblad Expeditions and SAG Holdings

Can any of the company-specific risk be diversified away by investing in both Lindblad Expeditions and SAG Holdings 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 SAG Holdings 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 SAG Holdings Limited, you can compare the effects of market volatilities on Lindblad Expeditions and SAG Holdings 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 SAG Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lindblad Expeditions and SAG Holdings.

Diversification Opportunities for Lindblad Expeditions and SAG Holdings

-0.52

Correlation Coefficient

Lindblad Expeditions  SAG Holdings

Excellent diversification

The 3 months correlation between Lindblad and SAG is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Lindblad Expeditions Holdings and SAG Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAG Holdings Limited 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 SAG Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAG Holdings Limited has no effect on the direction of Lindblad Expeditions i.e., Lindblad Expeditions and SAG Holdings go up and down completely randomly.

Pair Corralation between Lindblad Expeditions and SAG Holdings

Given the investment horizon of 90 days Lindblad Expeditions Holdings is expected to under-perform the SAG Holdings. But the stock apears to be less risky and, when comparing its historical volatility, Lindblad Expeditions Holdings is 1.64 times less risky than SAG Holdings. The stock trades about -0.11 of its potential returns per unit of risk. The SAG Holdings Limited is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  294.00  in SAG Holdings Limited on October 10, 2024 and sell it today you would lose (5.00) from holding SAG Holdings Limited or give up 1.7% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.24%
Values	Daily Returns

Lindblad Expeditions Holdings  vs.  SAG Holdings Limited

Lindblad Expeditions

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Lindblad Expeditions Holdings are ranked lower than 6 (%) 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.

SAG Holdings Limited

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SAG Holdings Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Lindblad Expeditions and SAG Holdings

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

The idea behind Lindblad Expeditions Holdings and SAG Holdings Limited 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.