Direxion Daily Gold Miners Bull 3X ETF

Fears in the overall financial market about a Brexit, the possible exit of Britain from the European Union, have abated. This helped gold fall.

Gold price’s reversal this year has created opportunities in gold stocks. The SPDR Gold Shares ETF (GLD) had gained 11% year-to-date as of Friday.

After falling 18% in 1Q17, physical demand for gold seems to have picked up in 2Q17.

Among major gold (GLD)(IAU) mining and gold streaming companies (GOAU), Wheaton Precious Metals (WPM) is analysts’ favorite and has received the most “buy” recommendations at 91%.

The Direxion Daily Gold Miners (NUGT) and the ProShares Ultra Silver (AGQ), both leveraged mining funds, both have recovered and jumped 19.4% and 24.9%, respectively, on a five-day trailing basis.

Oil is widely used in mining exploration, and a surge in oil prices may squeeze miners’ margins, leading to a fall in their share prices.

Gold hit a fresh six-year high on Friday as trade tensions between the US and China escalated. The SPDR Gold Shares ETF (GLD) closed up 2%.

During DoubleLine’s investor webcast on June 13, Jeffrey Gundlach said, “I am certainly long gold.” His call on gold is based on his expectation that the US dollar (UUP) will finish lower this year.

Gold miners usually act as a leveraged play on gold prices. In 2018, the VanEck Vectors Gold Miners ETF (GDX) fell 9.3%, amplifying the 1.9% fall in gold prices (GLD).

At the end of 2018, Barrick Gold (GOLD) reported mineral reserves of 64.5 million ounces—a decline of 3.4% YoY.

When it comes to investing in stocks, Berkshire Hathway’s (BRK.A) chair, Warren Buffett, and Bridgewater’s founder, Ray Dalio, have similar advice.

While China and Russia have the fifth and sixth largest gold reserves globally, the movements in them are the most watched by gold investors the world over mainly because these economies have been quite vocal about adding gold reserves.

On October 5, Gold Fields, Agnico-Eagle, Cia De Minas Buenaventura, and AngloGold had implied volatility readings of 40.4%, 33.6%, 35.3%, and 40.9%, respectively.

On September 29, Alamos, First Majestic Silver, Franco-Nevada, and Pan American had call implied volatilities of 46.9%, 54.6%, 25.5%, and 34%, respectively.

On September 18, gold fell 1.1% and closed at $1,306.90 per ounce. Of the precious metals, silver fell 3.1% and closed at $17.10 per ounce.

Among the four miners we’re looking at, Gold Fields has the highest correlation to gold on a YTD basis, while Sibanye Gold has the lowest correlation to gold.

Miners’ correlation with gold In this part, we’ll look at mining stocks’ correlation with precious metals by comparing their price movement. Specifically, we’ll analyze Alamos Gold (AGI), First Majestic Silver (AG), B2Gold (BTG), and Royal Gold (RGLD). The mining stocks have recovered in the past few weeks. The Direxion Daily Gold Miners Bull 3x Shares […]

Silver Wheaton has a three-year correlation of ~0.70 with gold and a year-to-date correlation of ~0.80.

Mining stocks have bounced back from the choppy markets seen over the past week.

Gold tumbled to an eight-week low on July 3, 2017. Gold futures for August delivery fell almost 1.9% to settle at $1,219.2 per ounce.

When we try to interpret the performance of precious metals, it’s crucial to study the impact of metal price variations on mining shares.

The rise and fall of precious metals also significantly impact mining-based leveraged funds like the Direxion Daily Gold Miners (NUGT) and Proshares Ultra Silver (AGQ).

On June 6, the implied volatilities of Alamos Gold, Primero Mining, Silver Wheaton, and Franco-Nevada were 51.1%, 90.6%, 30.8%, and 24.5%, respectively.

Fears surrounding a potential upcoming interest rate hike took over precious metals recently, and they fell at the beginning of May 2017.

Newmont Mining, Silver Wheaton, Randgold, and Yamana have RSI levels of 45.5, 37.1, 41.2, and 43.0, respectively.

Among the leveraged mining funds, the Direxion Daily Gold Miners ETF (NUGT) and the Proshares Ultra Silver ETF (AGQ) have seen considerable losses over the past month.

Mining stocks and precious metals As global tumult grips markets and investors are turning to mining stocks as safe havens, it’s crucial to understand which stocks are closely tied to precious metals. Stocks with a higher correlation with precious metals will likely be impacted more by global indicators that influence precious metals. The Direxion Daily […]

Leveraged mining funds including the Direxion Daily Gold Miners (NUGT) and the Proshares Ultra Silver (AGQ) saw big jumps in early 2017 due to the revival in precious metals.

As of April 6, 2017, the volatilities of New Gold (NGD), Agnico Eagle (AEM), Silver Wheaton (SLW), and Franco-Nevada (FNV) were 55.5%, 36.6%, 34%, and 30.1%, respectively.

As of April 4, 2017, the volatilities of New Gold (NGD), Agnico Eagle Mines (AEM), Silver Wheaton (SLW), and Randgold Resources (GOLD) were 51.5%, 35.4%, 61.7%, and 54.1%, respectively.

After remaining subdued for the past few months, gold futures last week recorded their highest weekly gain of 2.4% since February 3.

Now that mining companies have begun witnessing revivals from their losses earlier this year, it becomes crucial to examine the volatility figures and RSI.

NUGT and AGQ have seen YTD rises of 18.6% and 27.5%, respectively. But the volatility of such mining funds can be higher than that of precious metals.

Mining companies’ volatilities are significant to the buying process. The mining shares we’ve selected in this article are Kinross Gold, Eldorado Gold, IAMGOLD, and Harmony Gold.

As of March 15, the volatilities of Silver Wheaton, AngloGold Ashanti, Hecla Mining, and Kinross Gold were 38.2%, 36.2%, 29.3%, and 40.6%, respectively.

Monitoring the implied volatilities of large mining stocks is important. We should also watch their RSI (relative strength index) levels, particularly in the wake of changing precious metals prices.

Precious metal mining stocks are known to closely track the performances of precious metals.

Agnico-Eagle Mines has the highest correlation to gold year-to-date. Primero Mining is the least correlated to gold.

Call implied volatility takes into account the changes in an asset’s price due to variations in the price of its call option.

Many of the recent changes in precious metals have been determined by changes in the interest rates offered on US Treasuries.

It’s important to monitor the implied volatilities and RSI levels of large mining stocks, particularly in the wake of the changes in precious metal prices.

Precious metal mining stocks are known to closely track the performance of their respective precious metals. Mining stocks often show more volatility than metals.

Sibanye Gold, Gold Fields, Agnico-Eagle Mines, and Pan American Silver had RSI levels of 51.4, 54.6, 59.4, and 58.8, respectively.

In this part, we’ll look at the implied volatilities of large mining stocks and their RSI levels in the wake of precious metal prices.

Precious-metal-based funds such as the ProShares Ultra Silver (AGQ) and the Direxion Daily Gold Miners (NUGT) have seen a revival in their price during the last month.

Among the other precious metals trading on the COMEX, silver shares for March expiration maintained an almost flat end to the day on January 11, 2017.

Precious metals had a great start to 2016. Franco-Nevada’s correlation rose from an ~0.59 three-year correlation to an ~0.63 one-year correlation.

Mining companies that have high correlations with gold include Buenaventura (BVN), AngloGold Ashanti (AU), Hecla Mining (HL), and Kinross Gold (KGC).

Precious metals had a great start to 2016, but they’ve been falling since Donald Trump won the US presidential election. As a result, mining stocks have also been falling.

Mining stocks and gold Although precious metals were doing well at the beginning of 2016, it’s important to know which mining stocks overperformed and underperformed precious metals. Precious metal prices have been falling since Donald Trump won the US presidential election on November 8, 2016. As a result, mining stocks have also been falling. Mining […]