Correlation Between Mosaic and Mesa Air

Can any of the company-specific risk be diversified away by investing in both Mosaic 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 Mosaic and Mesa Air into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between The Mosaic and Mesa Air Group, you can compare the effects of market volatilities on Mosaic 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 Mosaic with a short position of Mesa Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mosaic and Mesa Air.

Diversification Opportunities for Mosaic and Mesa Air

-0.43

Correlation Coefficient

Mosaic  Mesa Air

Very good diversification

The 3 months correlation between Mosaic and Mesa is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding The Mosaic 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 Mosaic 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 The Mosaic 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 Mosaic i.e., Mosaic and Mesa Air go up and down completely randomly.

Pair Corralation between Mosaic and Mesa Air

Considering the 90-day investment horizon The Mosaic is expected to under-perform the Mesa Air. But the stock apears to be less risky and, when comparing its historical volatility, The Mosaic is 2.93 times less risky than Mesa Air. The stock trades about -0.05 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  233.00  in Mesa Air Group on September 30, 2024 and sell it today you would lose (102.00) from holding Mesa Air Group or give up 43.78% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

The Mosaic  vs.  Mesa Air Group

Mosaic

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days The Mosaic has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Mesa Air Group

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Mesa Air Group are ranked lower than 3 (%) 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.

Pair Trading with Mosaic and Mesa Air

The main advantage of trading using opposite Mosaic and Mesa Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mosaic 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 The Mosaic 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.

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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.