Correlation Between ADDvantage Technologies and Bowlin Travel

Can any of the company-specific risk be diversified away by investing in both ADDvantage Technologies and Bowlin Travel 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 ADDvantage Technologies and Bowlin Travel into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ADDvantage Technologies Group and Bowlin Travel Centers, you can compare the effects of market volatilities on ADDvantage Technologies and Bowlin Travel 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 ADDvantage Technologies with a short position of Bowlin Travel. Check out your portfolio center. Please also check ongoing floating volatility patterns of ADDvantage Technologies and Bowlin Travel.

Diversification Opportunities for ADDvantage Technologies and Bowlin Travel

0.0

Correlation Coefficient

ADDvantage Technologies  Bowlin Travel

Pay attention - limited upside

The 3 months correlation between ADDvantage and Bowlin is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ADDvantage Technologies Group and Bowlin Travel Centers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bowlin Travel Centers and ADDvantage Technologies 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 ADDvantage Technologies Group are associated (or correlated) with Bowlin Travel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bowlin Travel Centers has no effect on the direction of ADDvantage Technologies i.e., ADDvantage Technologies and Bowlin Travel go up and down completely randomly.

Pair Corralation between ADDvantage Technologies and Bowlin Travel

If you would invest  350.00  in Bowlin Travel Centers on May 7, 2025 and sell it today you would earn a total of  75.00  from holding Bowlin Travel Centers or generate 21.43% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

ADDvantage Technologies Group  vs.  Bowlin Travel Centers

ADDvantage Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days ADDvantage Technologies Group has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable technical and fundamental indicators, ADDvantage Technologies is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Bowlin Travel Centers

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Bowlin Travel Centers are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite quite uncertain basic indicators, Bowlin Travel disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ADDvantage Technologies and Bowlin Travel

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

The idea behind ADDvantage Technologies Group and Bowlin Travel Centers 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.