Correlation Between Heng Leasing and Hydrogen Freehold

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

By analyzing existing cross correlation between Heng Leasing Capital and Hydrogen Freehold Leasehold, you can compare the effects of market volatilities on Heng Leasing and Hydrogen Freehold 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 Heng Leasing with a short position of Hydrogen Freehold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heng Leasing and Hydrogen Freehold.

Diversification Opportunities for Heng Leasing and Hydrogen Freehold

0.3

Correlation Coefficient

Heng Leasing  Hydrogen Freehold

Weak diversification

The 3 months correlation between Heng and Hydrogen is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Heng Leasing Capital and Hydrogen Freehold Leasehold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hydrogen Freehold and Heng Leasing 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 Heng Leasing Capital are associated (or correlated) with Hydrogen Freehold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hydrogen Freehold has no effect on the direction of Heng Leasing i.e., Heng Leasing and Hydrogen Freehold go up and down completely randomly.

Pair Corralation between Heng Leasing and Hydrogen Freehold

Assuming the 90 days trading horizon Heng Leasing Capital is expected to generate 4.06 times more return on investment than Hydrogen Freehold. However, Heng Leasing is 4.06 times more volatile than Hydrogen Freehold Leasehold. It trades about -0.04 of its potential returns per unit of risk. Hydrogen Freehold Leasehold is currently generating about -0.2 per unit of risk. If you would invest  124.00  in Heng Leasing Capital on December 2, 2024 and sell it today you would lose (10.00) from holding Heng Leasing Capital or give up 8.06% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

Heng Leasing Capital  vs.  Hydrogen Freehold Leasehold

Heng Leasing Capital

Risk-Adjusted Performance

Very Weak

Over the last 90 days Heng Leasing Capital has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's forward-looking signals remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Hydrogen Freehold

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hydrogen Freehold Leasehold has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Heng Leasing and Hydrogen Freehold

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

The idea behind Heng Leasing Capital and Hydrogen Freehold Leasehold 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.