Correlation Between CACI International and Penn National
Can any of the company-specific risk be diversified away by investing in both CACI International and Penn National 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 Penn National into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CACI International and Penn National Gaming, you can compare the effects of market volatilities on CACI International and Penn National 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 Penn National. Check out your portfolio center. Please also check ongoing floating volatility patterns of CACI International and Penn National.
Diversification Opportunities for CACI International and Penn National
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CACI and Penn is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding CACI International and Penn National Gaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Penn National Gaming 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 Penn National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Penn National Gaming has no effect on the direction of CACI International i.e., CACI International and Penn National go up and down completely randomly.
Pair Corralation between CACI International and Penn National
Given the investment horizon of 90 days CACI International is expected to generate 3.86 times less return on investment than Penn National. But when comparing it to its historical volatility, CACI International is 1.7 times less risky than Penn National. It trades about 0.06 of its potential returns per unit of risk. Penn National Gaming is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 1,515 in Penn National Gaming on April 24, 2025 and sell it today you would earn a total of 346.00 from holding Penn National Gaming or generate 22.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CACI International vs. Penn National Gaming
Performance |
| Timeline |
| CACI International |
| Penn National Gaming |
CACI International and Penn National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CACI International and Penn National
The main advantage of trading using opposite CACI International and Penn National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CACI International position performs unexpectedly, Penn National 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 Penn National will offset losses from the drop in Penn National's long position.| CACI International vs. Science Applications International | CACI International vs. Leidos Holdings | CACI International vs. ExlService Holdings | CACI International vs. Parsons Corp |
| Penn National vs. DraftKings | Penn National vs. MGM Resorts International | Penn National vs. Caesars Entertainment | Penn National vs. Boyd Gaming |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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