Buy, Sell or Hold Pairs Trade: Why it's Time to Sell Fiat SpA (Pink ADR: FIATY) and Buy Ford Motor Co. (NYSE: F)

With all that's happening in Europe right now - not to mention economic expectations and consumer-spending trends both overseas and here in the United States - I find that we have an interesting " pairs trade " available to us. And the trade that I'm talking about is to have investors sell Fiat SpA (Pink ADR: FIATY ) and buy Ford Motor Co. (NYSE: F ). The inspiration for this trade stems from an experience I had as a teenager. Indeed, it's been more than 25 years since the story I'm about to relate took place, but the memories are so vivid that they're never far from my thoughts. Neither are the lessons I learned - which is fortuitous, since those lessons are especially applicable in today's unforgiving financial markets. You see, I was 18 and was in the market for my very first car. Against my father's wishes - and against what should have been my better judgment - I purchased a used-and-abused Fiat Spider . In the four years I owned the Fiat, I believe it was in actual running shape for a total of perhaps 11 months. True, the car had been driven hard before I owned it. And I loved that car, despite its failings - after all, I was 18 and the Fiat was a convertible. But I ultimately came to realize that my father had been right ... and that a big reason the Spider was in such bad shape was that it had been a poorly manufactured car to begin with. Dad had tried to warn me away from that Fiat sports car: The warning signs were all there, he said at the time. I just didn't see or hear them. Today, when I look at Fiat - the company - I'm experiencing the same warning signals. But this time they're warning me away from Fiat's stock. Here is how we can listen to what the market is saying about Italy - and its largest employer, Fiat - and use those insights in a pairs-trading strategy that will save some money on one trade, and make some money on the second. Let's begin with a close look at Fiat SpA (Pink ADR: FIATY ).