Correlation Between Lindblad Expeditions and Citi Trends

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

Diversification Opportunities for Lindblad Expeditions and Citi Trends

0.32

Correlation Coefficient

Lindblad Expeditions  Citi Trends

Weak diversification

The 3 months correlation between Lindblad and Citi is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Lindblad Expeditions Holdings and Citi Trends in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citi Trends 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 Citi Trends. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citi Trends has no effect on the direction of Lindblad Expeditions i.e., Lindblad Expeditions and Citi Trends go up and down completely randomly.

Pair Corralation between Lindblad Expeditions and Citi Trends

Given the investment horizon of 90 days Lindblad Expeditions Holdings is expected to generate 1.23 times more return on investment than Citi Trends. However, Lindblad Expeditions is 1.23 times more volatile than Citi Trends. It trades about 0.06 of its potential returns per unit of risk. Citi Trends is currently generating about 0.06 per unit of risk. If you would invest  947.00  in Lindblad Expeditions Holdings on September 25, 2024 and sell it today you would earn a total of  258.00  from holding Lindblad Expeditions Holdings or generate 27.24% 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.  Citi Trends

Lindblad Expeditions

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Lindblad Expeditions Holdings are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent basic indicators, Lindblad Expeditions exhibited solid returns over the last few months and may actually be approaching a breakup point.

Citi Trends

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Citi Trends are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Citi Trends displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Lindblad Expeditions and Citi Trends

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

The idea behind Lindblad Expeditions Holdings and Citi Trends 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.