Correlation Between Mesa Air and Zura Bio

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Can any of the company-specific risk be diversified away by investing in both Mesa Air and Zura Bio 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 Zura Bio 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 Zura Bio Limited, you can compare the effects of market volatilities on Mesa Air and Zura Bio 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 Zura Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mesa Air and Zura Bio.

Diversification Opportunities for Mesa Air and Zura Bio

MesaZuraDiversified AwayMesaZuraDiversified Away100%
-0.44
  Correlation Coefficient

Very good diversification

The 3 months correlation between Mesa and Zura is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Mesa Air Group and Zura Bio Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zura Bio Limited 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 Zura Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zura Bio Limited has no effect on the direction of Mesa Air i.e., Mesa Air and Zura Bio go up and down completely randomly.

Pair Corralation between Mesa Air and Zura Bio

Given the investment horizon of 90 days Mesa Air Group is expected to generate 0.62 times more return on investment than Zura Bio. However, Mesa Air Group is 1.62 times less risky than Zura Bio. It trades about -0.07 of its potential returns per unit of risk. Zura Bio Limited is currently generating about -0.24 per unit of risk. If you would invest  127.00  in Mesa Air Group on December 2, 2024 and sell it today you would lose (13.00) from holding Mesa Air Group or give up 10.24% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Mesa Air Group  vs.  Zura Bio Limited

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -60-40-200204060
JavaScript chart by amCharts 3.21.15MESA ZURA
       Timeline  
Mesa Air Group 

Risk-Adjusted Performance

Insignificant

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Mesa Air Group are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Mesa Air sustained solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15JanFebFebMar11.051.11.151.21.251.31.351.4
Zura Bio Limited 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Zura Bio Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.
JavaScript chart by amCharts 3.21.15JanFebFebMar1.522.53

Mesa Air and Zura Bio Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-14.19-10.63-7.07-3.50.03.647.4111.1714.9418.71 0.0100.0120.0140.0160.018
JavaScript chart by amCharts 3.21.15MESA ZURA
       Returns  

Pair Trading with Mesa Air and Zura Bio

The main advantage of trading using opposite Mesa Air and Zura Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mesa Air position performs unexpectedly, Zura Bio 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 Zura Bio will offset losses from the drop in Zura Bio's long position.
The idea behind Mesa Air Group and Zura Bio Limited 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.

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