Correlation Between Decisionpoint Systems and SpringBig Holdings

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

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

Diversification Opportunities for Decisionpoint Systems and SpringBig Holdings

0.0

Correlation Coefficient

Decisionpoint Systems  SpringBig Holdings

Pay attention - limited upside

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

Pair Corralation between Decisionpoint Systems and SpringBig Holdings

If you would invest  51.00  in Decisionpoint Systems on October 5, 2024 and sell it today you would earn a total of  0.00  from holding Decisionpoint Systems or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	92.37%
Values	Daily Returns

Decisionpoint Systems  vs.  SpringBig Holdings

Decisionpoint Systems

Risk-Adjusted Performance

0 of 100

Very Weak

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

SpringBig Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SpringBig Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable forward indicators, SpringBig Holdings is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Decisionpoint Systems and SpringBig Holdings

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

The idea behind Decisionpoint Systems and SpringBig Holdings 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.