Correlation Between Seabridge Gold and Sibanye Gold
Can any of the company-specific risk be diversified away by investing in both Seabridge Gold and Sibanye 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 Sibanye 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 Sibanye Gold Ltd, you can compare the effects of market volatilities on Seabridge Gold and Sibanye 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 Sibanye Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seabridge Gold and Sibanye Gold.
Diversification Opportunities for Seabridge Gold and Sibanye Gold
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Seabridge and Sibanye is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Seabridge Gold and Sibanye Gold Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sibanye 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 Sibanye Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sibanye Gold has no effect on the direction of Seabridge Gold i.e., Seabridge Gold and Sibanye Gold go up and down completely randomly.
Pair Corralation between Seabridge Gold and Sibanye Gold
Allowing for the 90-day total investment horizon Seabridge Gold is expected to under-perform the Sibanye Gold. But the stock apears to be less risky and, when comparing its historical volatility, Seabridge Gold is 1.55 times less risky than Sibanye Gold. The stock trades about -0.01 of its potential returns per unit of risk. The Sibanye Gold Ltd is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 347.00 in Sibanye Gold Ltd on November 2, 2024 and sell it today you would earn a total of 7.00 from holding Sibanye Gold Ltd or generate 2.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Seabridge Gold vs. Sibanye Gold Ltd
Performance |
| Timeline |
| Seabridge Gold |
| Sibanye Gold |
Seabridge Gold and Sibanye Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Seabridge Gold and Sibanye Gold
The main advantage of trading using opposite Seabridge Gold and Sibanye Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seabridge Gold position performs unexpectedly, Sibanye 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 Sibanye Gold will offset losses from the drop in Sibanye Gold's long position.| Seabridge Gold vs. Franco Nevada | Seabridge Gold vs. Wheaton Precious Metals | Seabridge Gold vs. Osisko Gold Ro | Seabridge Gold vs. Sandstorm Gold Ltd |
| Sibanye Gold vs. AngloGold Ashanti plc | Sibanye Gold vs. Harmony Gold Mining | Sibanye Gold vs. Eldorado Gold Corp | Sibanye Gold vs. Kinross Gold |
Check out your portfolio center.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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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