Correlation Between Seabridge Gold and Collective Mining

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

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

Diversification Opportunities for Seabridge Gold and Collective Mining

-0.1

Correlation Coefficient

Seabridge Gold  Collective Mining

Good diversification

The 3 months correlation between Seabridge and Collective is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Seabridge Gold and Collective Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Collective Mining and Seabridge Gold 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 Seabridge Gold are associated (or correlated) with Collective Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Collective Mining has no effect on the direction of Seabridge Gold i.e., Seabridge Gold and Collective Mining go up and down completely randomly.

Pair Corralation between Seabridge Gold and Collective Mining

Allowing for the 90-day total investment horizon Seabridge Gold is expected to generate 0.67 times more return on investment than Collective Mining. However, Seabridge Gold is 1.5 times less risky than Collective Mining. It trades about 0.15 of its potential returns per unit of risk. Collective Mining is currently generating about -0.01 per unit of risk. If you would invest  1,233  in Seabridge Gold on May 5, 2025 and sell it today you would earn a total of  298.00  from holding Seabridge Gold or generate 24.17% return on investment over 90 days.

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

Seabridge Gold  vs.  Collective Mining

Seabridge Gold

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Seabridge Gold are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady basic indicators, Seabridge Gold sustained solid returns over the last few months and may actually be approaching a breakup point.

Collective Mining

Risk-Adjusted Performance

Very Weak

Over the last 90 days Collective Mining has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Collective Mining is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Seabridge Gold and Collective Mining

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

The idea behind Seabridge Gold and Collective Mining 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.