Correlation Between Trust Stamp and Guardforce

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

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

Diversification Opportunities for Trust Stamp and Guardforce

0.62

Correlation Coefficient

Trust Stamp  Guardforce

Poor diversification

The 3 months correlation between Trust and Guardforce is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Trust Stamp and Guardforce AI Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guardforce AI and Trust Stamp 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 Trust Stamp are associated (or correlated) with Guardforce. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guardforce AI has no effect on the direction of Trust Stamp i.e., Trust Stamp and Guardforce go up and down completely randomly.

Pair Corralation between Trust Stamp and Guardforce

Given the investment horizon of 90 days Trust Stamp is expected to generate 1.93 times less return on investment than Guardforce. In addition to that, Trust Stamp is 1.37 times more volatile than Guardforce AI Co. It trades about 0.05 of its total potential returns per unit of risk. Guardforce AI Co is currently generating about 0.12 per unit of volatility. If you would invest  122.00  in Guardforce AI Co on September 28, 2024 and sell it today you would earn a total of  27.00  from holding Guardforce AI Co or generate 22.13% return on investment over 90 days.

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

Trust Stamp  vs.  Guardforce AI Co

Trust Stamp

Risk-Adjusted Performance

12 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Trust Stamp are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain basic indicators, Trust Stamp demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Guardforce AI

Risk-Adjusted Performance

6 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Guardforce AI Co are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, Guardforce demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Trust Stamp and Guardforce

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

The idea behind Trust Stamp and Guardforce AI Co 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.