Correlation Between Leidos Holdings and CACI International
Can any of the company-specific risk be diversified away by investing in both Leidos Holdings and CACI International 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 Leidos Holdings and CACI International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Leidos Holdings and CACI International, you can compare the effects of market volatilities on Leidos Holdings and CACI International 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 Leidos Holdings with a short position of CACI International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Leidos Holdings and CACI International.
Diversification Opportunities for Leidos Holdings and CACI International
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Leidos and CACI is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Leidos Holdings and CACI International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CACI International and Leidos Holdings 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 Leidos Holdings are associated (or correlated) with CACI International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CACI International has no effect on the direction of Leidos Holdings i.e., Leidos Holdings and CACI International go up and down completely randomly.
Pair Corralation between Leidos Holdings and CACI International
Given the investment horizon of 90 days Leidos Holdings is expected to generate 3.08 times less return on investment than CACI International. But when comparing it to its historical volatility, Leidos Holdings is 1.29 times less risky than CACI International. It trades about 0.02 of its potential returns per unit of risk. CACI International is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 40,803 in CACI International on March 25, 2025 and sell it today you would earn a total of 4,554 from holding CACI International or generate 11.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Leidos Holdings vs. CACI International
Performance |
| Timeline |
| Leidos Holdings |
| CACI International |
Leidos Holdings and CACI International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Leidos Holdings and CACI International
The main advantage of trading using opposite Leidos Holdings and CACI International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Leidos Holdings position performs unexpectedly, CACI International 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 CACI International will offset losses from the drop in CACI International's long position.| Leidos Holdings vs. CACI International | Leidos Holdings vs. Parsons Corp | Leidos Holdings vs. ASGN Inc | Leidos Holdings vs. ExlService Holdings |
| CACI International vs. Leidos Holdings | CACI International vs. Parsons Corp | CACI International vs. ASGN Inc | CACI International vs. ExlService Holdings |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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