Correlation Between SpringBig Holdings and Fidelity Select

Can any of the company-specific risk be diversified away by investing in both SpringBig Holdings and Fidelity Select 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 SpringBig Holdings and Fidelity Select into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between SpringBig Holdings and Fidelity Select Semiconductors, you can compare the effects of market volatilities on SpringBig Holdings and Fidelity Select 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 SpringBig Holdings with a short position of Fidelity Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of SpringBig Holdings and Fidelity Select.

Diversification Opportunities for SpringBig Holdings and Fidelity Select

-0.67

Correlation Coefficient

SpringBig Holdings  Fidelity Select

Excellent diversification

The 3 months correlation between SpringBig and Fidelity is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding SpringBig Holdings and Fidelity Select Semiconductors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Select Semi and SpringBig Holdings 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 SpringBig Holdings are associated (or correlated) with Fidelity Select. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Select Semi has no effect on the direction of SpringBig Holdings i.e., SpringBig Holdings and Fidelity Select go up and down completely randomly.

Pair Corralation between SpringBig Holdings and Fidelity Select

If you would invest  2,999  in Fidelity Select Semiconductors on February 4, 2024 and sell it today you would earn a total of  35.00  from holding Fidelity Select Semiconductors or generate 1.17% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	4.55%
Values	Daily Returns

SpringBig Holdings  vs.  Fidelity Select Semiconductors

SpringBig Holdings

Risk-Adjusted Performance

0 of 100

Very Strong

Over the last 90 days SpringBig Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly fragile technical and fundamental indicators, SpringBig Holdings showed solid returns over the last few months and may actually be approaching a breakup point.

Fidelity Select Semi

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Select Semiconductors are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak essential indicators, Fidelity Select showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with SpringBig Holdings and Fidelity Select

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

The idea behind SpringBig Holdings and Fidelity Select Semiconductors 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.