Correlation Between Seabridge Gold and Kinross Gold

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Can any of the company-specific risk be diversified away by investing in both Seabridge Gold and Kinross Gold 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 Kinross Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Seabridge Gold and Kinross Gold, you can compare the effects of market volatilities on Seabridge Gold and Kinross Gold 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 Kinross Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seabridge Gold and Kinross Gold.

Diversification Opportunities for Seabridge Gold and Kinross Gold

SeabridgeKinrossDiversified AwaySeabridgeKinrossDiversified Away100%
-0.1
  Correlation Coefficient

Good diversification

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

Pair Corralation between Seabridge Gold and Kinross Gold

Allowing for the 90-day total investment horizon Seabridge Gold is expected to under-perform the Kinross Gold. In addition to that, Seabridge Gold is 1.94 times more volatile than Kinross Gold. It trades about -0.06 of its total potential returns per unit of risk. Kinross Gold is currently generating about 0.06 per unit of volatility. If you would invest  1,069  in Kinross Gold on November 25, 2024 and sell it today you would earn a total of  28.00  from holding Kinross Gold or generate 2.62% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Seabridge Gold  vs.  Kinross Gold

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -20-100102030
JavaScript chart by amCharts 3.21.15SA KGC
       Timeline  
Seabridge Gold 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Seabridge Gold has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in March 2025. The current disturbance may also be a sign of long term up-swing for the company investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb1112131415
Kinross Gold 

Risk-Adjusted Performance

Modest

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Kinross Gold are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Kinross Gold exhibited solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb99.51010.51111.512

Seabridge Gold and Kinross Gold Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-5.39-4.04-2.68-1.330.01.182.43.624.846.06 0.0350.0400.0450.0500.055
JavaScript chart by amCharts 3.21.15SA KGC
       Returns  

Pair Trading with Seabridge Gold and Kinross Gold

The main advantage of trading using opposite Seabridge Gold and Kinross Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seabridge Gold position performs unexpectedly, Kinross Gold 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 Kinross Gold will offset losses from the drop in Kinross Gold's long position.
The idea behind Seabridge Gold and Kinross Gold 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.

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