Correlation Between CACI International and Infosys
Can any of the company-specific risk be diversified away by investing in both CACI International and Infosys 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 Infosys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CACI International and Infosys Ltd ADR, you can compare the effects of market volatilities on CACI International and Infosys 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 Infosys. Check out your portfolio center. Please also check ongoing floating volatility patterns of CACI International and Infosys.
Diversification Opportunities for CACI International and Infosys
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CACI and Infosys is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding CACI International and Infosys Ltd ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infosys Ltd ADR 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 Infosys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infosys Ltd ADR has no effect on the direction of CACI International i.e., CACI International and Infosys go up and down completely randomly.
Pair Corralation between CACI International and Infosys
Given the investment horizon of 90 days CACI International is expected to generate 0.9 times more return on investment than Infosys. However, CACI International is 1.11 times less risky than Infosys. It trades about 0.07 of its potential returns per unit of risk. Infosys Ltd ADR is currently generating about 0.03 per unit of risk. If you would invest 31,295 in CACI International on August 24, 2024 and sell it today you would earn a total of 16,253 from holding CACI International or generate 51.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CACI International vs. Infosys Ltd ADR
Performance |
| Timeline |
| CACI International |
| Infosys Ltd ADR |
CACI International and Infosys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CACI International and Infosys
The main advantage of trading using opposite CACI International and Infosys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CACI International position performs unexpectedly, Infosys 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 Infosys will offset losses from the drop in Infosys' long position.| CACI International vs. Leidos Holdings | CACI International vs. Parsons Corp | CACI International vs. ASGN Inc | CACI International vs. ExlService Holdings |
| Infosys vs. Concentrix | Infosys vs. Accenture plc | Infosys vs. International Business Machines | Infosys vs. Cognizant Technology Solutions |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |