Correlation Between Lindblad Expeditions and Boston Beer

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

Diversification Opportunities for Lindblad Expeditions and Boston Beer

0.33

Correlation Coefficient

Lindblad Expeditions  Boston Beer

Weak diversification

The 3 months correlation between Lindblad and Boston is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Lindblad Expeditions Holdings and Boston Beer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boston Beer 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 Boston Beer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boston Beer has no effect on the direction of Lindblad Expeditions i.e., Lindblad Expeditions and Boston Beer go up and down completely randomly.

Pair Corralation between Lindblad Expeditions and Boston Beer

Given the investment horizon of 90 days Lindblad Expeditions Holdings is expected to generate 1.68 times more return on investment than Boston Beer. However, Lindblad Expeditions is 1.68 times more volatile than Boston Beer. It trades about -0.06 of its potential returns per unit of risk. Boston Beer is currently generating about -0.17 per unit of risk. If you would invest  1,204  in Lindblad Expeditions Holdings on December 29, 2024 and sell it today you would lose (177.00) from holding Lindblad Expeditions Holdings or give up 14.7% of portfolio value over 90 days.

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

Lindblad Expeditions Holdings  vs.  Boston Beer

Lindblad Expeditions

Risk-Adjusted Performance

Very Weak

Over the last 90 days Lindblad Expeditions Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Boston Beer

Risk-Adjusted Performance

Very Weak

Over the last 90 days Boston Beer has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Lindblad Expeditions and Boston Beer

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

The idea behind Lindblad Expeditions Holdings and Boston Beer 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.