Correlation Between Mesa Air and Aquestive Therapeutics
Can any of the company-specific risk be diversified away by investing in both Mesa Air and Aquestive Therapeutics 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 Aquestive Therapeutics 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 Aquestive Therapeutics, you can compare the effects of market volatilities on Mesa Air and Aquestive Therapeutics 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 Aquestive Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mesa Air and Aquestive Therapeutics.
Diversification Opportunities for Mesa Air and Aquestive Therapeutics
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Mesa and Aquestive is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Mesa Air Group and Aquestive Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aquestive Therapeutics 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 Aquestive Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aquestive Therapeutics has no effect on the direction of Mesa Air i.e., Mesa Air and Aquestive Therapeutics go up and down completely randomly.
Pair Corralation between Mesa Air and Aquestive Therapeutics
Given the investment horizon of 90 days Mesa Air is expected to generate 64.2 times less return on investment than Aquestive Therapeutics. In addition to that, Mesa Air is 1.24 times more volatile than Aquestive Therapeutics. It trades about 0.0 of its total potential returns per unit of risk. Aquestive Therapeutics is currently generating about 0.08 per unit of volatility. If you would invest 73.00 in Aquestive Therapeutics on December 4, 2024 and sell it today you would earn a total of 192.00 from holding Aquestive Therapeutics or generate 263.01% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Mesa Air Group vs. Aquestive Therapeutics
Performance |
Timeline |
Mesa Air Group |
Aquestive Therapeutics |
Mesa Air and Aquestive Therapeutics Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Mesa Air and Aquestive Therapeutics
The main advantage of trading using opposite Mesa Air and Aquestive Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mesa Air position performs unexpectedly, Aquestive Therapeutics 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 Aquestive Therapeutics will offset losses from the drop in Aquestive Therapeutics' long position.Mesa Air vs. Allegiant Travel | Mesa Air vs. Sun Country Airlines | Mesa Air vs. Frontier Group Holdings | Mesa Air vs. Azul SA |
Aquestive Therapeutics vs. Evoke Pharma | Aquestive Therapeutics vs. Dynavax Technologies | Aquestive Therapeutics vs. Amphastar P | Aquestive Therapeutics vs. Lantheus Holdings |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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