Correlation Between Mesa Air and Alvotech
Can any of the company-specific risk be diversified away by investing in both Mesa Air and Alvotech 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 Mesa Air and Alvotech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mesa Air Group and Alvotech, you can compare the effects of market volatilities on Mesa Air and Alvotech 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 Mesa Air with a short position of Alvotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mesa Air and Alvotech.
Diversification Opportunities for Mesa Air and Alvotech
Excellent diversification
The 3 months correlation between Mesa and Alvotech is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Mesa Air Group and Alvotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alvotech and Mesa Air 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 Mesa Air Group are associated (or correlated) with Alvotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alvotech has no effect on the direction of Mesa Air i.e., Mesa Air and Alvotech go up and down completely randomly.
Pair Corralation between Mesa Air and Alvotech
Given the investment horizon of 90 days Mesa Air Group is expected to generate 1.28 times more return on investment than Alvotech. However, Mesa Air is 1.28 times more volatile than Alvotech. It trades about -0.05 of its potential returns per unit of risk. Alvotech is currently generating about -0.1 per unit of risk. If you would invest 90.00 in Mesa Air Group on August 25, 2024 and sell it today you would lose (3.00) from holding Mesa Air Group or give up 3.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mesa Air Group vs. Alvotech
Performance |
| Timeline |
| Mesa Air Group |
| Alvotech |
Mesa Air and Alvotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mesa Air and Alvotech
The main advantage of trading using opposite Mesa Air and Alvotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mesa Air position performs unexpectedly, Alvotech 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 Alvotech will offset losses from the drop in Alvotech's long position.| Mesa Air vs. Allegiant Travel | Mesa Air vs. Sun Country Airlines | Mesa Air vs. Frontier Group Holdings | Mesa Air vs. Azul SA |
| Alvotech vs. Eliem Therapeutics | Alvotech vs. HCW Biologics | Alvotech vs. Scpharmaceuticals | Alvotech vs. Milestone Pharmaceuticals |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |