Correlation Between INET Leasehold and Heng Leasing

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

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

Diversification Opportunities for INET Leasehold and Heng Leasing

-0.65

Correlation Coefficient

INET Leasehold  Heng Leasing

Excellent diversification

The 3 months correlation between INET and Heng is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding INET Leasehold REIT and Heng Leasing Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heng Leasing Capital and INET Leasehold 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 INET Leasehold REIT are associated (or correlated) with Heng Leasing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heng Leasing Capital has no effect on the direction of INET Leasehold i.e., INET Leasehold and Heng Leasing go up and down completely randomly.

Pair Corralation between INET Leasehold and Heng Leasing

Assuming the 90 days trading horizon INET Leasehold REIT is expected to generate 0.28 times more return on investment than Heng Leasing. However, INET Leasehold REIT is 3.53 times less risky than Heng Leasing. It trades about -0.03 of its potential returns per unit of risk. Heng Leasing Capital is currently generating about -0.09 per unit of risk. If you would invest  943.00  in INET Leasehold REIT on April 16, 2025 and sell it today you would lose (3.00) from holding INET Leasehold REIT or give up 0.32% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

INET Leasehold REIT  vs.  Heng Leasing Capital

INET Leasehold REIT

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in INET Leasehold REIT are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, INET Leasehold may actually be approaching a critical reversion point that can send shares even higher in August 2025.

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.

Pair Trading with INET Leasehold and Heng Leasing

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

The idea behind INET Leasehold REIT and Heng Leasing Capital 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.