Correlation Between CACI International and Exponent

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

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

Diversification Opportunities for CACI International and Exponent

-0.01

Correlation Coefficient

CACI International  Exponent

Good diversification

The 3 months correlation between CACI and Exponent is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding CACI International and Exponent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exponent 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 Exponent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exponent has no effect on the direction of CACI International i.e., CACI International and Exponent go up and down completely randomly.

Pair Corralation between CACI International and Exponent

Given the investment horizon of 90 days CACI International is expected to generate 1.22 times more return on investment than Exponent. However, CACI International is 1.22 times more volatile than Exponent. It trades about 0.03 of its potential returns per unit of risk. Exponent is currently generating about -0.1 per unit of risk. If you would invest  48,902  in CACI International on July 3, 2025 and sell it today you would earn a total of  976.00  from holding CACI International or generate 2.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

CACI International  vs.  Exponent

CACI International

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in CACI International are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong fundamental indicators, CACI International is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Exponent

Risk-Adjusted Performance

Weakest

Over the last 90 days Exponent has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest inconsistent performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with CACI International and Exponent

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

The idea behind CACI International and Exponent 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.

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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.