Case study: Relationship between gold-copper prices and mining share prices on the New York, Toronto, and Australian stock exchanges, an application of structural equation modeling

Alonso Sánchez Torres (), Jose Carlos Veliz Palomino () and German Lobos Andrade ()
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Alonso Sánchez Torres: National University of Engineering
Jose Carlos Veliz Palomino: CENTRUM Católica Graduate Business School
German Lobos Andrade: Universidad de Talca

Mineral Economics, 2025, vol. 38, issue 4, No 4, 835-843

Abstract: Abstract Public mining companies list their shares on stock exchanges. The price of these mining shares is a product of the influence of various factors that are crucial to the prices of metals. Thus, this study evaluates an explanatory model of the share prices of mining sector companies and their relationship with the prices of the metals they produce, such as gold and copper. It adopts an explanatory design with observable variables using a quantitative approach. Data were collected from the transaction summaries of three mining companies listed on the New York, Toronto, and Australian Stock Exchanges. A relationship was found between gold and copper prices and the share prices on the stock exchanges of large gold- and copper-producing mining companies. Additionally, companies that produce only copper and not gold are also influenced by the price of gold, despite not producing this metal. The share prices of medium and small mining companies were primarily due to other factors. An explanatory model was proposed and developed for the variables of interest that empirically confirmed the reviewed theoretical proposals and revealed new and important findings. Using structural equation modelling (SEM) and multiple regression allowed simultaneous analysis of the study variables, which is superior to previous approaches with more limited statistical tools that use simple correlation or regression.

Keywords: Copper price; Gold price; Mining company shares; Structural equation modelling; PLS-SEM; E37; L25 (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1007/s13563-025-00498-7

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