Correlation Between Lindblad Expeditions and Pearson PLC
Can any of the company-specific risk be diversified away by investing in both Lindblad Expeditions and Pearson PLC 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 Pearson PLC 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 Pearson PLC ADR, you can compare the effects of market volatilities on Lindblad Expeditions and Pearson PLC 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 Pearson PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lindblad Expeditions and Pearson PLC.
Diversification Opportunities for Lindblad Expeditions and Pearson PLC
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Lindblad and Pearson is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Lindblad Expeditions Holdings and Pearson PLC ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pearson PLC ADR 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 Pearson PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pearson PLC ADR has no effect on the direction of Lindblad Expeditions i.e., Lindblad Expeditions and Pearson PLC go up and down completely randomly.
Pair Corralation between Lindblad Expeditions and Pearson PLC
Given the investment horizon of 90 days Lindblad Expeditions Holdings is expected to generate 5.31 times more return on investment than Pearson PLC. However, Lindblad Expeditions is 5.31 times more volatile than Pearson PLC ADR. It trades about 0.18 of its potential returns per unit of risk. Pearson PLC ADR is currently generating about 0.28 per unit of risk. If you would invest 1,007 in Lindblad Expeditions Holdings on August 30, 2024 and sell it today you would earn a total of 253.00 from holding Lindblad Expeditions Holdings or generate 25.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lindblad Expeditions Holdings vs. Pearson PLC ADR
Performance |
| Timeline |
| Lindblad Expeditions |
| Pearson PLC ADR |
Lindblad Expeditions and Pearson PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lindblad Expeditions and Pearson PLC
The main advantage of trading using opposite Lindblad Expeditions and Pearson PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lindblad Expeditions position performs unexpectedly, Pearson PLC 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 Pearson PLC will offset losses from the drop in Pearson PLC's long position.| Lindblad Expeditions vs. Yatra Online | Lindblad Expeditions vs. Despegar Corp | Lindblad Expeditions vs. Mondee Holdings | Lindblad Expeditions vs. MakeMyTrip Limited |
| Pearson PLC vs. John Wiley Sons | Pearson PLC vs. New York Times | Pearson PLC vs. Lee Enterprises Incorporated | Pearson PLC vs. Gannett Co |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |