Correlation Between Mesa Air and Beyond Meat
Can any of the company-specific risk be diversified away by investing in both Mesa Air and Beyond Meat 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 Beyond Meat 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 Beyond Meat, you can compare the effects of market volatilities on Mesa Air and Beyond Meat 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 Beyond Meat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mesa Air and Beyond Meat.
Diversification Opportunities for Mesa Air and Beyond Meat
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Mesa and Beyond is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Mesa Air Group and Beyond Meat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beyond Meat 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 Beyond Meat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beyond Meat has no effect on the direction of Mesa Air i.e., Mesa Air and Beyond Meat go up and down completely randomly.
Pair Corralation between Mesa Air and Beyond Meat
Given the investment horizon of 90 days Mesa Air Group is expected to generate 1.68 times more return on investment than Beyond Meat. However, Mesa Air is 1.68 times more volatile than Beyond Meat. It trades about 0.02 of its potential returns per unit of risk. Beyond Meat is currently generating about -0.11 per unit of risk. If you would invest 113.00 in Mesa Air Group on January 7, 2025 and sell it today you would lose (3.00) from holding Mesa Air Group or give up 2.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mesa Air Group vs. Beyond Meat
Performance |
| Timeline |
| Mesa Air Group |
| Beyond Meat |
Mesa Air and Beyond Meat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mesa Air and Beyond Meat
The main advantage of trading using opposite Mesa Air and Beyond Meat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mesa Air position performs unexpectedly, Beyond Meat 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 Beyond Meat will offset losses from the drop in Beyond Meat'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 |
| Beyond Meat vs. Kraft Heinz Co | Beyond Meat vs. Hormel Foods | Beyond Meat vs. Kellanova | Beyond Meat vs. General Mills |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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