Correlation Between Lindblad Expeditions and Titan Machinery

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

Diversification Opportunities for Lindblad Expeditions and Titan Machinery

0.48

Correlation Coefficient

Lindblad Expeditions  Titan Machinery

Very weak diversification

The 3 months correlation between Lindblad and Titan is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Lindblad Expeditions Holdings and Titan Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Titan Machinery 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 Titan Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Titan Machinery has no effect on the direction of Lindblad Expeditions i.e., Lindblad Expeditions and Titan Machinery go up and down completely randomly.

Pair Corralation between Lindblad Expeditions and Titan Machinery

Given the investment horizon of 90 days Lindblad Expeditions Holdings is expected to under-perform the Titan Machinery. But the stock apears to be less risky and, when comparing its historical volatility, Lindblad Expeditions Holdings is 1.06 times less risky than Titan Machinery. The stock trades about -0.09 of its potential returns per unit of risk. The Titan Machinery is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  1,319  in Titan Machinery on December 20, 2024 and sell it today you would earn a total of  154.00  from holding Titan Machinery or generate 11.68% return on investment over 90 days.

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

Lindblad Expeditions Holdings  vs.  Titan Machinery

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.

Titan Machinery

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Titan Machinery are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady basic indicators, Titan Machinery displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Lindblad Expeditions and Titan Machinery

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

The idea behind Lindblad Expeditions Holdings and Titan Machinery 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 CEOs Directory module to screen CEOs from public companies around the world.