Mining stocks can certainly benefit from gold’s run as the precious metal looks to break past the $2,600 per ounce mark. Gold prices are already up about 23% for the year and could keep on rallying with a number of tailwinds behind it.
August volatility certainly brought gold into the spotlight as investors sought safe haven amid stock market volatility. But even before that, central bank buying and the expectation of a weaker dollar on the prospect of rate cuts was already propelling gold higher.
With the demand for gold pushing higher, it could spill over into gold mining stocks. Notable gold bull Peter Schiff was effusive in his praise for gold mining stocks. Schiff noted on X that precious metal mining could be one of the prime sectors offering the best gains for the next 10 years.
#Gold just had two consecutive daily closes above $2,500. Many gold mining stocks hit new 52-week highs today. The stage is set for a major bull market. I expect precious metals mining to be the best-performing sector, not just for the remainder of this year, but for this decade.
— Peter Schiff (@PeterSchiff) August 19, 2024
With the NYSE Arca Gold Miners Index juxtaposed with the S&P GSCI Gold index, it provides a visual of how mining stocks have tracked gold prices via the futures market. The S&P index was initially tracking higher to start the year, but the NYSE mining index has surpassed it, rising 25% for the year versus the S&P’s 23% gain.
Easy Gold Mining Access
Building a gold mining portfolio will require investors to pore over options from various market cap sizes. An easier way for gold mining equities access is via exchange-traded funds like the Sprott Gold Miners ETF (SGDM) and the Sprott Junior Gold Miners ETF (SGDJ).
SGDM seeks investment results that correspond generally to the performance of the Solactive Gold Miners Custom Factors Index. This index tracks the performance of large gold companies found on Canadian and major U.S. exchanges.
For investors looking to capitalize on the potential of small-caps, SGDJ tracks the Solactive Junior Gold Miners Custom Factors Index. It follows the performance of the small-cap precious metal companies, allowing for greater growth potential. Small-caps have the propensity to make amplified moves toward the upside when the broader market is trending higher, making this an ideal option for those who also want small-cap exposure.
For more news, information, and analysis, visit the Gold/Silver/Critical Materials Channel.
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