Correlation Between Guardforce and PTC

Can any of the company-specific risk be diversified away by investing in both Guardforce and PTC 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 PTC 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 PTC Inc, you can compare the effects of market volatilities on Guardforce and PTC 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 PTC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guardforce and PTC.

Diversification Opportunities for Guardforce and PTC

0.28

Correlation Coefficient

Guardforce  PTC

Modest diversification

The 3 months correlation between Guardforce and PTC is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Guardforce AI Co and PTC Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PTC Inc 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 PTC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PTC Inc has no effect on the direction of Guardforce i.e., Guardforce and PTC go up and down completely randomly.

Pair Corralation between Guardforce and PTC

Assuming the 90 days horizon Guardforce AI Co is expected to generate 26.53 times more return on investment than PTC. However, Guardforce is 26.53 times more volatile than PTC Inc. It trades about 0.15 of its potential returns per unit of risk. PTC Inc is currently generating about 0.07 per unit of risk. If you would invest  12.00  in Guardforce AI Co on September 21, 2024 and sell it today you would earn a total of  14.00  from holding Guardforce AI Co or generate 116.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	84.13%
Values	Daily Returns

Guardforce AI Co  vs.  PTC Inc

Guardforce AI

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Guardforce AI Co are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak forward indicators, Guardforce showed solid returns over the last few months and may actually be approaching a breakup point.

PTC Inc

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in PTC Inc are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather abnormal basic indicators, PTC may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Guardforce and PTC

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

The idea behind Guardforce AI Co and PTC Inc 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.