Correlation Between Guardforce and Trade Desk

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

Diversification Opportunities for Guardforce and Trade Desk

0.27

Correlation Coefficient

Guardforce  Trade Desk

Modest diversification

The 3 months correlation between Guardforce and Trade is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Guardforce AI Co and Trade Desk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trade Desk 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 Trade Desk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trade Desk has no effect on the direction of Guardforce i.e., Guardforce and Trade Desk go up and down completely randomly.

Pair Corralation between Guardforce and Trade Desk

Assuming the 90 days horizon Guardforce AI Co is expected to generate 18.47 times more return on investment than Trade Desk. However, Guardforce is 18.47 times more volatile than Trade Desk. It trades about 0.16 of its potential returns per unit of risk. Trade Desk is currently generating about 0.18 per unit of risk. If you would invest  13.00  in Guardforce AI Co on September 15, 2024 and sell it today you would earn a total of  21.00  from holding Guardforce AI Co or generate 161.54% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	81.25%
Values	Daily Returns

Guardforce AI Co  vs.  Trade Desk

Guardforce AI

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Guardforce AI Co are ranked lower than 12 (%) 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.

Trade Desk

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Trade Desk are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of rather abnormal basic indicators, Trade Desk exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Guardforce and Trade Desk

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

The idea behind Guardforce AI Co and Trade Desk 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.