Correlation Between Lindblad Expeditions and Canadian Pacific
Can any of the company-specific risk be diversified away by investing in both Lindblad Expeditions and Canadian Pacific 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 Canadian Pacific 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 Canadian Pacific Railway, you can compare the effects of market volatilities on Lindblad Expeditions and Canadian Pacific 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 Canadian Pacific. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lindblad Expeditions and Canadian Pacific.
Diversification Opportunities for Lindblad Expeditions and Canadian Pacific
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lindblad and Canadian is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Lindblad Expeditions Holdings and Canadian Pacific Railway in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canadian Pacific Railway 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 Canadian Pacific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canadian Pacific Railway has no effect on the direction of Lindblad Expeditions i.e., Lindblad Expeditions and Canadian Pacific go up and down completely randomly.
Pair Corralation between Lindblad Expeditions and Canadian Pacific
Given the investment horizon of 90 days Lindblad Expeditions Holdings is expected to under-perform the Canadian Pacific. In addition to that, Lindblad Expeditions is 3.23 times more volatile than Canadian Pacific Railway. It trades about -0.01 of its total potential returns per unit of risk. Canadian Pacific Railway is currently generating about 0.03 per unit of volatility. If you would invest 7,166 in Canadian Pacific Railway on January 17, 2024 and sell it today you would earn a total of 1,386 from holding Canadian Pacific Railway or generate 19.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lindblad Expeditions Holdings vs. Canadian Pacific Railway
Performance |
| Timeline |
| Lindblad Expeditions |
| Canadian Pacific Railway |
Lindblad Expeditions and Canadian Pacific Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lindblad Expeditions and Canadian Pacific
The main advantage of trading using opposite Lindblad Expeditions and Canadian Pacific positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lindblad Expeditions position performs unexpectedly, Canadian Pacific 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 Canadian Pacific will offset losses from the drop in Canadian Pacific's long position.| Lindblad Expeditions vs. Yatra Online | Lindblad Expeditions vs. Despegar Corp | Lindblad Expeditions vs. Mondee Holdings | Lindblad Expeditions vs. MakeMyTrip Limited |
| Canadian Pacific vs. Union Pacific | Canadian Pacific vs. CSX Corporation | Canadian Pacific vs. Norfolk Southern | Canadian Pacific vs. Westinghouse Air Brake |
Check out your portfolio center.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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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