Correlation Between Revolution Medicines and Renovaro Biosciences

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

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

Diversification Opportunities for Revolution Medicines and Renovaro Biosciences

-0.78

Correlation Coefficient

Revolution Medicines  Renovaro Biosciences

Pay attention - limited upside

The 3 months correlation between Revolution and Renovaro is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Revolution Medicines and Renovaro Biosciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Renovaro Biosciences and Revolution Medicines 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 Revolution Medicines are associated (or correlated) with Renovaro Biosciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Renovaro Biosciences has no effect on the direction of Revolution Medicines i.e., Revolution Medicines and Renovaro Biosciences go up and down completely randomly.

Pair Corralation between Revolution Medicines and Renovaro Biosciences

Given the investment horizon of 90 days Revolution Medicines is expected to generate 0.43 times more return on investment than Renovaro Biosciences. However, Revolution Medicines is 2.35 times less risky than Renovaro Biosciences. It trades about 0.14 of its potential returns per unit of risk. Renovaro Biosciences is currently generating about -0.18 per unit of risk. If you would invest  3,837  in Revolution Medicines on July 12, 2025 and sell it today you would earn a total of  925.00  from holding Revolution Medicines or generate 24.11% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	89.06%
Values	Daily Returns

Revolution Medicines  vs.  Renovaro Biosciences

Revolution Medicines

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Revolution Medicines are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak primary indicators, Revolution Medicines exhibited solid returns over the last few months and may actually be approaching a breakup point.

Renovaro Biosciences

Risk-Adjusted Performance

Weakest

Over the last 90 days Renovaro Biosciences has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in November 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Revolution Medicines and Renovaro Biosciences

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

The idea behind Revolution Medicines and Renovaro Biosciences 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.