Correlation Between AuthID and Telos Corp

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

By analyzing existing cross correlation between authID Inc and Telos Corp, you can compare the effects of market volatilities on AuthID and Telos Corp 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 AuthID with a short position of Telos Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of AuthID and Telos Corp.

Diversification Opportunities for AuthID and Telos Corp

0.23

Correlation Coefficient

AuthID  Telos Corp

Modest diversification

The 3 months correlation between AuthID and Telos is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding authID Inc and Telos Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Telos Corp and AuthID 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 authID Inc are associated (or correlated) with Telos Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Telos Corp has no effect on the direction of AuthID i.e., AuthID and Telos Corp go up and down completely randomly.

Pair Corralation between AuthID and Telos Corp

Given the investment horizon of 90 days authID Inc is expected to under-perform the Telos Corp. In addition to that, AuthID is 1.35 times more volatile than Telos Corp. It trades about -0.08 of its total potential returns per unit of risk. Telos Corp is currently generating about -0.01 per unit of volatility. If you would invest  365.00  in Telos Corp on August 30, 2024 and sell it today you would lose (25.00) from holding Telos Corp or give up 6.85% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

authID Inc  vs.  Telos Corp

authID Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days authID Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's forward indicators remain rather sound which may send shares a bit higher in December 2024. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Telos Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Telos Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable essential indicators, Telos Corp is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with AuthID and Telos Corp

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

The idea behind authID Inc and Telos Corp 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.