Correlation Between Lindblad Expeditions and Shimmick Common

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

Diversification Opportunities for Lindblad Expeditions and Shimmick Common

0.31

Correlation Coefficient

Lindblad Expeditions  Shimmick Common

Weak diversification

The 3 months correlation between Lindblad and Shimmick is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Lindblad Expeditions Holdings and Shimmick Common in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shimmick Common 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 Shimmick Common. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shimmick Common has no effect on the direction of Lindblad Expeditions i.e., Lindblad Expeditions and Shimmick Common go up and down completely randomly.

Pair Corralation between Lindblad Expeditions and Shimmick Common

Given the investment horizon of 90 days Lindblad Expeditions is expected to generate 1.73 times less return on investment than Shimmick Common. But when comparing it to its historical volatility, Lindblad Expeditions Holdings is 1.26 times less risky than Shimmick Common. It trades about 0.09 of its potential returns per unit of risk. Shimmick Common is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  191.00  in Shimmick Common on October 25, 2024 and sell it today you would earn a total of  73.00  from holding Shimmick Common or generate 38.22% return on investment over 90 days.

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

Lindblad Expeditions Holdings  vs.  Shimmick Common

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.

Shimmick Common

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Shimmick Common are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of very weak forward indicators, Shimmick Common displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Lindblad Expeditions and Shimmick Common

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

The idea behind Lindblad Expeditions Holdings and Shimmick Common 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.