Research preview

The new codeshare agreement between a major African carrier and a leading Chinese airline will reshape air traffic flows between Africa, China and beyond. For quantitative traders, the partnership creates new data signals and risk considerations that can be incorporated into models for equities, currencies and commodity exposure linked to travel demand. The Economic Rationale Behind the Codeshare A codeshare allows two airlines to sell seats on each other’s flights under their own flight numbers. The immediate effect is a larger network of marketed routes without the need for additional aircraft. For the two carriers, the partnership expands market reach, improves load factors and stabilizes revenue streams....