Correlation Between CACI International and Open Text

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

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

Diversification Opportunities for CACI International and Open Text

0.72

Correlation Coefficient

CACI International  Open Text

Poor diversification

The 3 months correlation between CACI and Open is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding CACI International and Open Text Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Open Text Corp 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 Open Text. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Open Text Corp has no effect on the direction of CACI International i.e., CACI International and Open Text go up and down completely randomly.

Pair Corralation between CACI International and Open Text

Given the investment horizon of 90 days CACI International is expected to generate 1.19 times less return on investment than Open Text. In addition to that, CACI International is 1.11 times more volatile than Open Text Corp. It trades about 0.16 of its total potential returns per unit of risk. Open Text Corp is currently generating about 0.21 per unit of volatility. If you would invest  3,002  in Open Text Corp on July 29, 2025 and sell it today you would earn a total of  933.00  from holding Open Text Corp or generate 31.08% return on investment over 90 days.

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

CACI International  vs.  Open Text Corp

CACI International

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CACI International are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak fundamental indicators, CACI International demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Open Text Corp

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Open Text Corp are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady technical and fundamental indicators, Open Text showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CACI International and Open Text

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

The idea behind CACI International and Open Text Corp 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.