Correlation Between Guardforce and BioAffinity Technologies

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

Diversification Opportunities for Guardforce and BioAffinity Technologies

-0.48

Correlation Coefficient

Guardforce  BioAffinity Technologies

Very good diversification

The 3 months correlation between Guardforce and BioAffinity is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Guardforce AI Co and bioAffinity Technologies Warra in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BioAffinity Technologies 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 BioAffinity Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BioAffinity Technologies has no effect on the direction of Guardforce i.e., Guardforce and BioAffinity Technologies go up and down completely randomly.

Pair Corralation between Guardforce and BioAffinity Technologies

Assuming the 90 days horizon Guardforce AI Co is expected to generate 3.71 times more return on investment than BioAffinity Technologies. However, Guardforce is 3.71 times more volatile than bioAffinity Technologies Warrant. It trades about 0.31 of its potential returns per unit of risk. bioAffinity Technologies Warrant is currently generating about -0.24 per unit of risk. If you would invest  5.01  in Guardforce AI Co on September 29, 2024 and sell it today you would earn a total of  33.99  from holding Guardforce AI Co or generate 678.44% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	76.19%
Values	Daily Returns

Guardforce AI Co  vs.  bioAffinity Technologies Warra

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 abnormal forward indicators, Guardforce showed solid returns over the last few months and may actually be approaching a breakup point.

BioAffinity Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days bioAffinity Technologies Warrant has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's technical and fundamental indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Guardforce and BioAffinity Technologies

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

The idea behind Guardforce AI Co and bioAffinity Technologies Warrant 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.