Correlation Between Aterian and Lindblad Expeditions

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

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

Diversification Opportunities for Aterian and Lindblad Expeditions

-0.41

Correlation Coefficient

Aterian  Lindblad Expeditions

Very good diversification

The 3 months correlation between Aterian and Lindblad is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Aterian and Lindblad Expeditions Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lindblad Expeditions and Aterian 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 Aterian 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 Aterian i.e., Aterian and Lindblad Expeditions go up and down completely randomly.

Pair Corralation between Aterian and Lindblad Expeditions

Given the investment horizon of 90 days Aterian is expected to under-perform the Lindblad Expeditions. But the stock apears to be less risky and, when comparing its historical volatility, Aterian is 1.58 times less risky than Lindblad Expeditions. The stock trades about -0.14 of its potential returns per unit of risk. The Lindblad Expeditions Holdings is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  996.00  in Lindblad Expeditions Holdings on September 15, 2024 and sell it today you would earn a total of  180.00  from holding Lindblad Expeditions Holdings or generate 18.07% return on investment over 90 days.

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

Aterian  vs.  Lindblad Expeditions Holdings

Aterian

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aterian has generated negative risk-adjusted returns adding no value to investors with long positions. Even with uncertain performance in the last few months, the Stock's technical and fundamental indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

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.

Pair Trading with Aterian and Lindblad Expeditions

The main advantage of trading using opposite Aterian and Lindblad Expeditions positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aterian 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 Aterian 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.