Correlation Between CACI International and Thoughtworks Holding

Can any of the company-specific risk be diversified away by investing in both CACI International and Thoughtworks Holding 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 Thoughtworks Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CACI International and Thoughtworks Holding, you can compare the effects of market volatilities on CACI International and Thoughtworks Holding 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 Thoughtworks Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of CACI International and Thoughtworks Holding.

Diversification Opportunities for CACI International and Thoughtworks Holding

0.0

Correlation Coefficient

CACI International  Thoughtworks Holding

Pay attention - limited upside

The 3 months correlation between CACI and Thoughtworks is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CACI International and Thoughtworks Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thoughtworks Holding 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 Thoughtworks Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thoughtworks Holding has no effect on the direction of CACI International i.e., CACI International and Thoughtworks Holding go up and down completely randomly.

Pair Corralation between CACI International and Thoughtworks Holding

If you would invest (100.00) in Thoughtworks Holding on December 30, 2024 and sell it today you would earn a total of  100.00  from holding Thoughtworks Holding or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

CACI International  vs.  Thoughtworks Holding

CACI International

Risk-Adjusted Performance

Very Weak

Over the last 90 days CACI International has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong fundamental indicators, CACI International is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.

Thoughtworks Holding

Risk-Adjusted Performance

Very Weak

Over the last 90 days Thoughtworks Holding has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable forward-looking signals, Thoughtworks Holding is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with CACI International and Thoughtworks Holding

The main advantage of trading using opposite CACI International and Thoughtworks Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CACI International position performs unexpectedly, Thoughtworks Holding 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 Thoughtworks Holding will offset losses from the drop in Thoughtworks Holding's long position.

The idea behind CACI International and Thoughtworks Holding pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.