Correlation Between AmTrust Financial and OneMedNet Corp

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

By analyzing existing cross correlation between AmTrust Financial Services and OneMedNet Corp, you can compare the effects of market volatilities on AmTrust Financial and OneMedNet Corp 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 AmTrust Financial with a short position of OneMedNet Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of AmTrust Financial and OneMedNet Corp.

Diversification Opportunities for AmTrust Financial and OneMedNet Corp

-0.58

Correlation Coefficient

AmTrust Financial  OneMedNet Corp

Excellent diversification

The 3 months correlation between AmTrust and OneMedNet is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding AmTrust Financial Services and OneMedNet Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OneMedNet Corp and AmTrust Financial 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 AmTrust Financial Services are associated (or correlated) with OneMedNet Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OneMedNet Corp has no effect on the direction of AmTrust Financial i.e., AmTrust Financial and OneMedNet Corp go up and down completely randomly.

Pair Corralation between AmTrust Financial and OneMedNet Corp

Assuming the 90 days horizon AmTrust Financial is expected to generate 108.96 times less return on investment than OneMedNet Corp. But when comparing it to its historical volatility, AmTrust Financial Services is 13.8 times less risky than OneMedNet Corp. It trades about 0.01 of its potential returns per unit of risk. OneMedNet Corp is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  3.39  in OneMedNet Corp on September 27, 2024 and sell it today you would lose (1.59) from holding OneMedNet Corp or give up 46.9% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	69.84%
Values	Daily Returns

AmTrust Financial Services  vs.  OneMedNet Corp

AmTrust Financial

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AmTrust Financial Services has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable forward indicators, AmTrust Financial is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

OneMedNet Corp

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in OneMedNet Corp are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain fundamental indicators, OneMedNet Corp showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with AmTrust Financial and OneMedNet Corp

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

The idea behind AmTrust Financial Services and OneMedNet Corp 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.