Correlation Between CACI International and Salesforce
Can any of the company-specific risk be diversified away by investing in both CACI International and Salesforce 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 Salesforce into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CACI International and Salesforce, you can compare the effects of market volatilities on CACI International and Salesforce 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 Salesforce. Check out your portfolio center. Please also check ongoing floating volatility patterns of CACI International and Salesforce.
Diversification Opportunities for CACI International and Salesforce
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between CACI and Salesforce is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding CACI International and Salesforce in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Salesforce 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 Salesforce. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Salesforce has no effect on the direction of CACI International i.e., CACI International and Salesforce go up and down completely randomly.
Pair Corralation between CACI International and Salesforce
Given the investment horizon of 90 days CACI International is expected to generate 0.82 times more return on investment than Salesforce. However, CACI International is 1.22 times less risky than Salesforce. It trades about 0.2 of its potential returns per unit of risk. Salesforce is currently generating about -0.21 per unit of risk. If you would invest 37,883 in CACI International on January 28, 2024 and sell it today you would earn a total of 2,604 from holding CACI International or generate 6.87% 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. Salesforce
Performance |
Timeline |
CACI International |
Salesforce |
CACI International and Salesforce Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CACI International and Salesforce
The main advantage of trading using opposite CACI International and Salesforce positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CACI International position performs unexpectedly, Salesforce 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 Salesforce will offset losses from the drop in Salesforce's long position.CACI International vs. EPAM Systems | CACI International vs. Infosys Ltd ADR | CACI International vs. Cognizant Technology Solutions | CACI International vs. FiscalNote Holdings |
Salesforce vs. Zoom Video Communications | Salesforce vs. C3 Ai Inc | Salesforce vs. Shopify | Salesforce vs. Workday |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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