Correlation Between Mesa Air and Inception Growth

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

Diversification Opportunities for Mesa Air and Inception Growth

0.84

Correlation Coefficient

Mesa Air  Inception Growth

Very poor diversification

The 3 months correlation between Mesa and Inception is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Mesa Air Group and Inception Growth Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inception Growth Acq 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 Inception Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inception Growth Acq has no effect on the direction of Mesa Air i.e., Mesa Air and Inception Growth go up and down completely randomly.

Pair Corralation between Mesa Air and Inception Growth

If you would invest  116.00  in Mesa Air Group on October 22, 2024 and sell it today you would earn a total of  17.00  from holding Mesa Air Group or generate 14.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	27.78%
Values	Daily Returns

Mesa Air Group  vs.  Inception Growth Acquisition

Mesa Air Group

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Mesa Air Group are ranked lower than 11 (%) 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.

Inception Growth Acq

Risk-Adjusted Performance

0 of 100

Solid

Over the last 90 days Inception Growth Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively abnormal basic indicators, Inception Growth may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Mesa Air and Inception Growth

The main advantage of trading using opposite Mesa Air and Inception Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mesa Air position performs unexpectedly, Inception Growth 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 Inception Growth will offset losses from the drop in Inception Growth's long position.

The idea behind Mesa Air Group and Inception Growth Acquisition 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.