Correlation Between Revolution Medicines and Abivax SA

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

By analyzing existing cross correlation between Revolution Medicines and Abivax SA American, you can compare the effects of market volatilities on Revolution Medicines and Abivax SA 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 Abivax SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Revolution Medicines and Abivax SA.

Diversification Opportunities for Revolution Medicines and Abivax SA

0.87

Correlation Coefficient

Revolution Medicines  Abivax SA

Very poor diversification

The 3 months correlation between Revolution and Abivax is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Revolution Medicines and Abivax SA American in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Abivax SA American 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 Abivax SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Abivax SA American has no effect on the direction of Revolution Medicines i.e., Revolution Medicines and Abivax SA go up and down completely randomly.

Pair Corralation between Revolution Medicines and Abivax SA

Given the investment horizon of 90 days Revolution Medicines is expected to generate 1.35 times more return on investment than Abivax SA. However, Revolution Medicines is 1.35 times more volatile than Abivax SA American. It trades about 0.25 of its potential returns per unit of risk. Abivax SA American is currently generating about 0.27 per unit of risk. If you would invest  3,718  in Revolution Medicines on August 2, 2025 and sell it today you would earn a total of  2,169  from holding Revolution Medicines or generate 58.34% return on investment over 90 days.

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

Revolution Medicines  vs.  Abivax SA American

Revolution Medicines

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Revolution Medicines are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent primary indicators, Revolution Medicines exhibited solid returns over the last few months and may actually be approaching a breakup point.

Abivax SA American

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Abivax SA American are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, Abivax SA showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Revolution Medicines and Abivax SA

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

The idea behind Revolution Medicines and Abivax SA American 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.