Correlation Between Guardforce and DatChat

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

Diversification Opportunities for Guardforce and DatChat

-0.45

Correlation Coefficient

Guardforce  DatChat

Very good diversification

The 3 months correlation between Guardforce and DatChat is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Guardforce AI Co and DatChat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DatChat 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 DatChat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DatChat has no effect on the direction of Guardforce i.e., Guardforce and DatChat go up and down completely randomly.

Pair Corralation between Guardforce and DatChat

Assuming the 90 days horizon Guardforce AI Co is expected to generate 1.88 times more return on investment than DatChat. However, Guardforce is 1.88 times more volatile than DatChat. It trades about 0.08 of its potential returns per unit of risk. DatChat is currently generating about -0.03 per unit of risk. If you would invest  22.00  in Guardforce AI Co on May 16, 2025 and sell it today you would earn a total of  4.00  from holding Guardforce AI Co or generate 18.18% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	87.1%
Values	Daily Returns

Guardforce AI Co  vs.  DatChat

Guardforce AI

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Guardforce AI Co are ranked lower than 5 (%) 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.

DatChat

Risk-Adjusted Performance

Weakest

Over the last 90 days DatChat has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Guardforce and DatChat

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

The idea behind Guardforce AI Co and DatChat 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.