Correlation Between Electromed and OneMedNet Corp

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

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

Diversification Opportunities for Electromed and OneMedNet Corp

-0.76

Correlation Coefficient

Electromed  OneMedNet Corp

Pay attention - limited upside

The 3 months correlation between Electromed and OneMedNet is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Electromed and OneMedNet Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OneMedNet Corp and Electromed 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 Electromed 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 Electromed i.e., Electromed and OneMedNet Corp go up and down completely randomly.

Pair Corralation between Electromed and OneMedNet Corp

Given the investment horizon of 90 days Electromed is expected to generate 10.41 times less return on investment than OneMedNet Corp. But when comparing it to its historical volatility, Electromed is 11.83 times less risky than OneMedNet Corp. It trades about 0.17 of its potential returns per unit of risk. OneMedNet Corp is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  2.70  in OneMedNet Corp on September 23, 2024 and sell it today you would earn a total of  1.31  from holding OneMedNet Corp or generate 48.52% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	74.42%
Values	Daily Returns

Electromed  vs.  OneMedNet Corp

Electromed

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Electromed are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent primary indicators, Electromed exhibited solid returns over the last few months and may actually be approaching a breakup point.

OneMedNet Corp

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in OneMedNet Corp are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating fundamental indicators, OneMedNet Corp showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Electromed and OneMedNet Corp

The main advantage of trading using opposite Electromed and OneMedNet Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electromed 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 Electromed 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.

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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.