Correlation Between Ainsworth Game and Mesa Air
Can any of the company-specific risk be diversified away by investing in both Ainsworth Game and Mesa Air 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 Ainsworth Game and Mesa Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ainsworth Game Technology and Mesa Air Group, you can compare the effects of market volatilities on Ainsworth Game and Mesa Air 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 Ainsworth Game with a short position of Mesa Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ainsworth Game and Mesa Air.
Diversification Opportunities for Ainsworth Game and Mesa Air
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ainsworth and Mesa is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Ainsworth Game Technology and Mesa Air Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mesa Air Group and Ainsworth Game 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 Ainsworth Game Technology are associated (or correlated) with Mesa Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mesa Air Group has no effect on the direction of Ainsworth Game i.e., Ainsworth Game and Mesa Air go up and down completely randomly.
Pair Corralation between Ainsworth Game and Mesa Air
Assuming the 90 days horizon Ainsworth Game Technology is expected to under-perform the Mesa Air. But the pink sheet apears to be less risky and, when comparing its historical volatility, Ainsworth Game Technology is 2.32 times less risky than Mesa Air. The pink sheet trades about -0.03 of its potential returns per unit of risk. The Mesa Air Group is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 181.00 in Mesa Air Group on August 31, 2024 and sell it today you would lose (73.00) from holding Mesa Air Group or give up 40.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.73% |
| Values | Daily Returns |
Ainsworth Game Technology vs. Mesa Air Group
Performance |
| Timeline |
| Ainsworth Game Technology |
| Mesa Air Group |
Ainsworth Game and Mesa Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ainsworth Game and Mesa Air
The main advantage of trading using opposite Ainsworth Game and Mesa Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ainsworth Game position performs unexpectedly, Mesa Air 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 Mesa Air will offset losses from the drop in Mesa Air's long position.The idea behind Ainsworth Game Technology and Mesa Air Group 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.| Mesa Air vs. Allegiant Travel | Mesa Air vs. Sun Country Airlines | Mesa Air vs. Frontier Group Holdings | Mesa Air vs. Azul SA |
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 CEOs Directory module to screen CEOs from public companies around the world.
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