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I think if it is Cady, then it can definitely work as its own name.

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I love Cady and Kate-sounding names. Especially:
Caitlin
Katharine
Katerina
Catriona
and just Kate

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I don't really like Katie that much. I think it's a fine NN for a kid but I would probably just go directly to the NN Kate from day 1. Unless you are talking about Cady - in which case, I fully support.