Correlation Between Proficient Auto and Lindblad Expeditions

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

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

Diversification Opportunities for Proficient Auto and Lindblad Expeditions

-0.43

Correlation Coefficient

Proficient Auto  Lindblad Expeditions

Very good diversification

The 3 months correlation between Proficient and Lindblad is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Proficient Auto Logistics, and Lindblad Expeditions Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lindblad Expeditions and Proficient Auto 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 Proficient Auto Logistics, are associated (or correlated) with Lindblad Expeditions. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lindblad Expeditions has no effect on the direction of Proficient Auto i.e., Proficient Auto and Lindblad Expeditions go up and down completely randomly.

Pair Corralation between Proficient Auto and Lindblad Expeditions

Considering the 90-day investment horizon Proficient Auto Logistics, is expected to generate 0.7 times more return on investment than Lindblad Expeditions. However, Proficient Auto Logistics, is 1.42 times less risky than Lindblad Expeditions. It trades about -0.13 of its potential returns per unit of risk. Lindblad Expeditions Holdings is currently generating about -0.15 per unit of risk. If you would invest  954.00  in Proficient Auto Logistics, on September 18, 2024 and sell it today you would lose (57.00) from holding Proficient Auto Logistics, or give up 5.97% of portfolio value over 90 days.

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

Proficient Auto Logistics,  vs.  Lindblad Expeditions Holdings

Proficient Auto Logi

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Proficient Auto Logistics, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Lindblad Expeditions

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Lindblad Expeditions Holdings are ranked lower than 4 (%) 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.

Pair Trading with Proficient Auto and Lindblad Expeditions

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

The idea behind Proficient Auto Logistics, and Lindblad Expeditions Holdings 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.