Correlation Between Bowlin Travel and MarineMax
Can any of the company-specific risk be diversified away by investing in both Bowlin Travel and MarineMax 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 Bowlin Travel and MarineMax into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bowlin Travel Centers and MarineMax, you can compare the effects of market volatilities on Bowlin Travel and MarineMax 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 Bowlin Travel with a short position of MarineMax. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bowlin Travel and MarineMax.
Diversification Opportunities for Bowlin Travel and MarineMax
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bowlin and MarineMax is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Bowlin Travel Centers and MarineMax in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MarineMax and Bowlin Travel 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 Bowlin Travel Centers are associated (or correlated) with MarineMax. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MarineMax has no effect on the direction of Bowlin Travel i.e., Bowlin Travel and MarineMax go up and down completely randomly.
Pair Corralation between Bowlin Travel and MarineMax
Given the investment horizon of 90 days Bowlin Travel Centers is expected to under-perform the MarineMax. But the pink sheet apears to be less risky and, when comparing its historical volatility, Bowlin Travel Centers is 2.05 times less risky than MarineMax. The pink sheet trades about -0.18 of its potential returns per unit of risk. The MarineMax is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 2,908 in MarineMax on August 24, 2024 and sell it today you would earn a total of 135.50 from holding MarineMax or generate 4.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bowlin Travel Centers vs. MarineMax
Performance |
| Timeline |
| Bowlin Travel Centers |
| MarineMax |
Bowlin Travel and MarineMax Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bowlin Travel and MarineMax
The main advantage of trading using opposite Bowlin Travel and MarineMax positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bowlin Travel position performs unexpectedly, MarineMax 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 MarineMax will offset losses from the drop in MarineMax's long position.| Bowlin Travel vs. Citi Trends | Bowlin Travel vs. Everspin Technologies | Bowlin Travel vs. Skechers USA | Bowlin Travel vs. Kontoor Brands |
| MarineMax vs. National Vision Holdings | MarineMax vs. Sally Beauty Holdings | MarineMax vs. Sportsmans | MarineMax vs. 1 800 FLOWERSCOM |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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