Correlation Between Crexendo and NETGEAR

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

By analyzing existing cross correlation between Crexendo and NETGEAR, you can compare the effects of market volatilities on Crexendo and NETGEAR 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 Crexendo with a short position of NETGEAR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crexendo and NETGEAR.

Diversification Opportunities for Crexendo and NETGEAR

0.26

Correlation Coefficient

Crexendo  NETGEAR

Modest diversification

The 3 months correlation between Crexendo and NETGEAR is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Crexendo and NETGEAR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NETGEAR and Crexendo 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 Crexendo are associated (or correlated) with NETGEAR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NETGEAR has no effect on the direction of Crexendo i.e., Crexendo and NETGEAR go up and down completely randomly.

Pair Corralation between Crexendo and NETGEAR

Given the investment horizon of 90 days Crexendo is expected to generate 1.4 times less return on investment than NETGEAR. In addition to that, Crexendo is 1.13 times more volatile than NETGEAR. It trades about 0.09 of its total potential returns per unit of risk. NETGEAR is currently generating about 0.15 per unit of volatility. If you would invest  2,485  in NETGEAR on August 6, 2025 and sell it today you would earn a total of  680.00  from holding NETGEAR or generate 27.36% return on investment over 90 days.

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

Crexendo  vs.  NETGEAR

Crexendo

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Crexendo are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating fundamental indicators, Crexendo displayed solid returns over the last few months and may actually be approaching a breakup point.

NETGEAR

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in NETGEAR are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Even with relatively uncertain technical and fundamental indicators, NETGEAR reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Crexendo and NETGEAR

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

The idea behind Crexendo and NETGEAR 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.