Correlation Between CACI International and Lumentum Holdings
Can any of the company-specific risk be diversified away by investing in both CACI International and Lumentum Holdings 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 Lumentum Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CACI International and Lumentum Holdings, you can compare the effects of market volatilities on CACI International and Lumentum Holdings 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 Lumentum Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of CACI International and Lumentum Holdings.
Diversification Opportunities for CACI International and Lumentum Holdings
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between CACI and Lumentum is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding CACI International and Lumentum Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lumentum Holdings 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 Lumentum Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lumentum Holdings has no effect on the direction of CACI International i.e., CACI International and Lumentum Holdings go up and down completely randomly.
Pair Corralation between CACI International and Lumentum Holdings
Given the investment horizon of 90 days CACI International is expected to generate 3.47 times less return on investment than Lumentum Holdings. But when comparing it to its historical volatility, CACI International is 2.86 times less risky than Lumentum Holdings. It trades about 0.2 of its potential returns per unit of risk. Lumentum Holdings is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 14,940 in Lumentum Holdings on September 6, 2025 and sell it today you would earn a total of 17,845 from holding Lumentum Holdings or generate 119.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
CACI International vs. Lumentum Holdings
Performance |
| Timeline |
| CACI International |
| Lumentum Holdings |
CACI International and Lumentum Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CACI International and Lumentum Holdings
The main advantage of trading using opposite CACI International and Lumentum Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CACI International position performs unexpectedly, Lumentum Holdings 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 Lumentum Holdings will offset losses from the drop in Lumentum Holdings' long position.| CACI International vs. Sterling Construction | CACI International vs. Critic Clothing | CACI International vs. China Outfitters Holdings | CACI International vs. Future Farm Technologies |
| Lumentum Holdings vs. AGNC Investment Corp | Lumentum Holdings vs. Darden Restaurants | Lumentum Holdings vs. VANGUARD FUNDS PLC | Lumentum Holdings vs. Westshore Terminals Investment |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |