Correlation Between Lindblad Expeditions and Reborn Coffee

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

Diversification Opportunities for Lindblad Expeditions and Reborn Coffee

-0.81

Correlation Coefficient

Lindblad Expeditions  Reborn Coffee

Pay attention - limited upside

The 3 months correlation between Lindblad and Reborn is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Lindblad Expeditions Holdings and Reborn Coffee in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Reborn Coffee 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 Reborn Coffee. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Reborn Coffee has no effect on the direction of Lindblad Expeditions i.e., Lindblad Expeditions and Reborn Coffee go up and down completely randomly.

Pair Corralation between Lindblad Expeditions and Reborn Coffee

Given the investment horizon of 90 days Lindblad Expeditions Holdings is expected to generate 0.72 times more return on investment than Reborn Coffee. However, Lindblad Expeditions Holdings is 1.39 times less risky than Reborn Coffee. It trades about 0.08 of its potential returns per unit of risk. Reborn Coffee is currently generating about -0.21 per unit of risk. 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	Significant
Accuracy	100.0%
Values	Daily Returns

Lindblad Expeditions Holdings  vs.  Reborn Coffee

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.

Reborn Coffee

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Reborn Coffee has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's fundamental drivers remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Lindblad Expeditions and Reborn Coffee

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

The idea behind Lindblad Expeditions Holdings and Reborn Coffee 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.