Correlation Between CACI International and Digimarc
Can any of the company-specific risk be diversified away by investing in both CACI International and Digimarc 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 Digimarc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CACI International and Digimarc, you can compare the effects of market volatilities on CACI International and Digimarc 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 Digimarc. Check out your portfolio center. Please also check ongoing floating volatility patterns of CACI International and Digimarc.
Diversification Opportunities for CACI International and Digimarc
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CACI and Digimarc is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding CACI International and Digimarc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Digimarc 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 Digimarc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Digimarc has no effect on the direction of CACI International i.e., CACI International and Digimarc go up and down completely randomly.
Pair Corralation between CACI International and Digimarc
Given the investment horizon of 90 days CACI International is expected to generate 0.45 times more return on investment than Digimarc. However, CACI International is 2.21 times less risky than Digimarc. It trades about -0.11 of its potential returns per unit of risk. Digimarc is currently generating about -0.43 per unit of risk. If you would invest 37,033 in CACI International on January 19, 2024 and sell it today you would lose (782.00) from holding CACI International or give up 2.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
CACI International vs. Digimarc
Performance |
| Timeline |
| CACI International |
| Digimarc |
CACI International and Digimarc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CACI International and Digimarc
The main advantage of trading using opposite CACI International and Digimarc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CACI International position performs unexpectedly, Digimarc 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 Digimarc will offset losses from the drop in Digimarc's long position.| CACI International vs. Pfizer Inc | CACI International vs. Home Federal Bancorp | CACI International vs. Betterware De Mexico | CACI International vs. Heartland Financial USA |
| Digimarc vs. Pfizer Inc | Digimarc vs. Home Federal Bancorp | Digimarc vs. Betterware De Mexico | Digimarc vs. Heartland Financial USA |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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