Correlation Between CACI International and Gartner
Can any of the company-specific risk be diversified away by investing in both CACI International and Gartner 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 Gartner into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CACI International and Gartner, you can compare the effects of market volatilities on CACI International and Gartner 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 Gartner. Check out your portfolio center. Please also check ongoing floating volatility patterns of CACI International and Gartner.
Diversification Opportunities for CACI International and Gartner
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between CACI and Gartner is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding CACI International and Gartner in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gartner 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 Gartner. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gartner has no effect on the direction of CACI International i.e., CACI International and Gartner go up and down completely randomly.
Pair Corralation between CACI International and Gartner
Given the investment horizon of 90 days CACI International is expected to generate 1.73 times less return on investment than Gartner. But when comparing it to its historical volatility, CACI International is 1.29 times less risky than Gartner. It trades about 0.06 of its potential returns per unit of risk. Gartner is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 30,192 in Gartner on January 24, 2024 and sell it today you would earn a total of 14,834 from holding Gartner or generate 49.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CACI International vs. Gartner
Performance |
| Timeline |
| CACI International |
| Gartner |
CACI International and Gartner Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CACI International and Gartner
The main advantage of trading using opposite CACI International and Gartner positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CACI International position performs unexpectedly, Gartner 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 Gartner will offset losses from the drop in Gartner's long position.| CACI International vs. FiscalNote Holdings | CACI International vs. Innodata | CACI International vs. Aurora Innovation | CACI International vs. Conduent |
| Gartner vs. FiscalNote Holdings | Gartner vs. Innodata | Gartner vs. Aurora Innovation | Gartner vs. Conduent |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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