Correlation Between OLB and SpringBig Holdings

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

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

Diversification Opportunities for OLB and SpringBig Holdings

0.4

Correlation Coefficient

OLB  SpringBig Holdings

Very weak diversification

The 3 months correlation between OLB and SpringBig is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding OLB Group and SpringBig Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SpringBig Holdings and OLB 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 OLB Group 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 OLB i.e., OLB and SpringBig Holdings go up and down completely randomly.

Pair Corralation between OLB and SpringBig Holdings

If you would invest  34.00  in SpringBig Holdings on September 13, 2024 and sell it today you would earn a total of  0.00  from holding SpringBig Holdings or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	4.76%
Values	Daily Returns

OLB Group  vs.  SpringBig Holdings

OLB Group

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in OLB Group are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak essential indicators, OLB may actually be approaching a critical reversion point that can send shares even higher in January 2025.

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 OLB and SpringBig Holdings

The main advantage of trading using opposite OLB and SpringBig Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OLB 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 OLB Group 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.

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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.