Correlation Between CACI International and CDW Corp
Can any of the company-specific risk be diversified away by investing in both CACI International and CDW Corp 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 CACI International and CDW Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CACI International and CDW Corp, you can compare the effects of market volatilities on CACI International and CDW Corp 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 CACI International with a short position of CDW Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of CACI International and CDW Corp.
Diversification Opportunities for CACI International and CDW Corp
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between CACI and CDW is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding CACI International and CDW Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CDW Corp and CACI International 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 CACI International are associated (or correlated) with CDW Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CDW Corp has no effect on the direction of CACI International i.e., CACI International and CDW Corp go up and down completely randomly.
Pair Corralation between CACI International and CDW Corp
Given the investment horizon of 90 days CACI International is expected to generate 0.83 times more return on investment than CDW Corp. However, CACI International is 1.21 times less risky than CDW Corp. It trades about -0.06 of its potential returns per unit of risk. CDW Corp is currently generating about -0.25 per unit of risk. If you would invest 36,870 in CACI International on January 20, 2024 and sell it today you would lose (464.00) from holding CACI International or give up 1.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
CACI International vs. CDW Corp
Performance |
| Timeline |
| CACI International |
| CDW Corp |
CACI International and CDW Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CACI International and CDW Corp
The main advantage of trading using opposite CACI International and CDW Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CACI International position performs unexpectedly, CDW Corp 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 CDW Corp will offset losses from the drop in CDW Corp's long position.| CACI International vs. Information Services Group | CACI International vs. Home Bancorp | CACI International vs. CRA International | CACI International vs. Aquagold International |
| CDW Corp vs. Maximus | CDW Corp vs. Network 1 Technologies | CDW Corp vs. First Advantage Corp | CDW Corp vs. BrightView 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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