Correlation Between Guardforce and Swvl Holdings

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

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

Diversification Opportunities for Guardforce and Swvl Holdings

-0.37

Correlation Coefficient

Guardforce  Swvl Holdings

Very good diversification

The 3 months correlation between Guardforce and Swvl is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Guardforce AI Co and Swvl Holdings Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Swvl Holdings Corp and Guardforce 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 Guardforce AI Co are associated (or correlated) with Swvl Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Swvl Holdings Corp has no effect on the direction of Guardforce i.e., Guardforce and Swvl Holdings go up and down completely randomly.

Pair Corralation between Guardforce and Swvl Holdings

Assuming the 90 days horizon Guardforce AI Co is expected to generate 2.13 times more return on investment than Swvl Holdings. However, Guardforce is 2.13 times more volatile than Swvl Holdings Corp. It trades about 0.11 of its potential returns per unit of risk. Swvl Holdings Corp is currently generating about 0.03 per unit of risk. If you would invest  17.00  in Guardforce AI Co on December 2, 2024 and sell it today you would earn a total of  8.00  from holding Guardforce AI Co or generate 47.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	86.89%
Values	Daily Returns

Guardforce AI Co  vs.  Swvl Holdings Corp

Guardforce AI

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Guardforce AI Co are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal forward indicators, Guardforce showed solid returns over the last few months and may actually be approaching a breakup point.

Swvl Holdings Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Swvl Holdings Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly conflicting essential indicators, Swvl Holdings showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Guardforce and Swvl Holdings

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

The idea behind Guardforce AI Co and Swvl Holdings 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.