uploads/// Gold Stocks

Will Gold Miners Keep Up Their Recent Run?

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Oct. 8 2020, Updated 1:27 p.m. ET

VanEck

Gold stocks were also in consolidation mode, as the NYSE Arca Gold Miners Index (GDMNTR)3 gained 1.1% and the MVIS Junior Gold Miners Index (MVGDXJTR)4 fell 2.0%.

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Gold miners in consolidation mode

While gold fell sharply in the last quarter of 2016, gold stocks weren’t far behind. The market capitalization–weighted NYSE Arca Gold Miners Index or GDM fell 20.2% in the last quarter. The index, which primarily comprises gold and silver mining companies around the world, fell to a nine-month low of 605.4 on December 16. Despite the fall in December, the index is up a whopping 54.7% in 2016. To date, the index has gained almost 19% from its December low.

The VanEck Vectors Gold Miners ETF (GDX), which tracks the NYSE Arca Gold Miners Index, gained 0.4% in December.

Junior gold miners index

The MVIS Global Junior Gold Miners Index, which tracks the performance of the most liquid junior companies in the global gold (ABX) (AEM) and silver mining industry, fell 24.1% in 4Q16. Though the index comprises major global companies, it’s heavily tilted toward companies based in Canada and Australia with a combined weight of almost 86.5%. The index is up 75.1% in 2016.

The VanEck Vectors Junior Gold Miners ETF (GDXJ), which tracks the MVIS Global Junior Gold Miners Index, fell 8% in December. The recent upswing in gold miners stocks (EGO) indicates that they’re consolidating at lower levels and likely to stay range-bound in the near term.

3NYSE Arca Gold Miners Index (GDMNTR) is a modified market capitalization-weighted index comprised of publicly traded companies involved primarily in the mining for gold.

4MVIS Global Junior Gold Miners Index (MVGDXJTR) is a rules-based, modified market capitalization-weighted, float-adjusted index comprised of a global universe of publicly traded small- and medium-capitalization companies that generate at least 50% of their revenues from gold and/or silver mining, hold real property that has the potential to produce at least 50% of the company’s revenue from gold or silver mining when developed, or primarily invest in gold or silver.

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