Correlation Between Spirit Airlines and Mesa Air
Can any of the company-specific risk be diversified away by investing in both Spirit Airlines 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 Spirit Airlines and Mesa Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Spirit Airlines and Mesa Air Group, you can compare the effects of market volatilities on Spirit Airlines 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 Spirit Airlines with a short position of Mesa Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spirit Airlines and Mesa Air.
Diversification Opportunities for Spirit Airlines and Mesa Air
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Spirit and Mesa is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Spirit Airlines 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 Spirit Airlines 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 Spirit Airlines 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 Spirit Airlines i.e., Spirit Airlines and Mesa Air go up and down completely randomly.
Pair Corralation between Spirit Airlines and Mesa Air
If you would invest 44.00 in Mesa Air Group on December 3, 2024 and sell it today you would earn a total of 56.00 from holding Mesa Air Group or generate 127.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Spirit Airlines vs. Mesa Air Group
Performance |
| Timeline |
| Spirit Airlines |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| Mesa Air Group |
Spirit Airlines and Mesa Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Spirit Airlines and Mesa Air
The main advantage of trading using opposite Spirit Airlines and Mesa Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spirit Airlines 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.| Spirit Airlines vs. American Airlines Group | ||
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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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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