operating leverage comps, page-207

@city1866

not sure thats quite the takeout you should be making

if sps moved with the metal price in linear fashion then everyone would just buy the metal

what i was saying was silver stocks are generally 100% correlated to the silver price energy/direction at start of a new silver bull cycle - but the speed of moves is larger because the implied leverage is larger (ie its 158Moz of silver being re-rated ith an implied discount because they are in ground not refined)

but the % changes in stock price vs metal price vary depending on size/discount of the stock's project vs EV, investor risk weightings - and length of cycle

so longer you get from the initial sharp moves in the metal price the more each stock creates its own performance based on its unique multiples/factors and so the implied correlation to silver metal price changes appears to become weaker over time - though it always remains quite strong at a trend level

the way you can know this is when cycles end and all of a sudden stocks all collapse back to a uniform correlated mass

thats what happened in march - which is why you could buy SVL/ MYL/KCN and PMY/IVR/ARD for fairly similar implied EVs

its basically conceptually like an universe, silver price is big bang energy for silver stocks. further you get from initial explosion more various stocks appear to act under their own local forces - and correltaions will appear to weaken

but the individual chart squiggles hide a deeper persistent correlation