Flight Centre Correlations

The current 90-days correlation between Flight Centre Travel and Norwegian Cruise Line is 0.06 (i.e., Significant diversification). The correlation of Flight Centre is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.

The ability to find closely correlated positions to Flight Centre could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Flight Centre when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Flight Centre - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Flight Centre Travel to buy it.