The gold mining industry, showing signs of recovery post-pandemic, is expected to grow by 5.5 percent in 2021. Although the World Gold Council reported that China was the biggest gold producer in 2020, some major gold mining companies are headquartered in Canada.
There are multiple ways to invest in gold today. Gold can be a solid and valuable long-term investment, especially if the dollar weakens or the stock market experiences a downturn.
How to invest in gold
Investors can choose from several approaches to gaining a position in the gold industry. They can buy physical gold in bars and coins, invest in actively managed gold funds, buy stock in gold mining companies, and invest in gold mining ETFs.
Gold mining stocks to invest in
Kinross Gold, a Canadian gold and silver mining company, trades on the NYSE as "KGC". It has operations in the Americas, West Africa, and Russia, and produced over 2.4 million ounces of gold in 2020. In 2021's first quarter, its net income grew 15 percent YoY (year-over-year) to $192.8 million.
Kirkland Lake Gold, with operations in Canada and Australia, has headquarters in Toronto. It trades on the NYSE as "KL" and it reported Q1 2021 revenue of $551.8 million.
Alamos Gold (AGI) is also based in Canada, with operations there and in the U.S., Turkey, and Mexico. National Bank maintained its “outperform” ranking for the stock in May and raised its price target to $14.25. In the first quarter of 2021, AGI met its earnings guidance, with its net earnings rising YoY from $29 million to $49 million.
Wheaton Precious Metals is a precious metal streaming company, with current streaming agreements for 23 operating mines. In 2021's first quarter, its net earnings grew 54 percent YoY, and the company increased its dividend in Q1 by 7.7 percent to $0.14 per share.
Agnico Eagle Mines has mines in Canada, Mexico, and Finland, and trades as "AEM" on the NYSE. It operates in gold, silver, zinc, and copper. In the first quarter of 2021, 97 percent of its revenue came from gold sales.
Gold mining ETFs
For someone looking to gain exposure to the gold mining market, a gold mining ETF can be a good way to start.
The VanEck Vectors Gold Miners ETF (GDX) aims to replicate the price and overall performance of the NYSE Arca Gold Miners Index (GDMNTR). Established in 2006, it comprises 53 companies, including Newmont and Barrick Gold.
The VanEck Vectors Junior Gold Miners ETF is traded as "GTXJ". The fund invests mainly in junior precious metal miners.
There's also the Global X Gold Explorers ETF (GOEX), which tracks the Solactive Global Gold Explorers & Developers Total Return Index and has $57.8 million in assets under management. Its holdings include Hecla Mining, Kirkland Lake Gold, and SSR Mining, among others.