An Introduction
The MunAiMarkets Gold/Silver ETFs Portfolio
The constituents in the Portfolio have gone up so far in January because of:
- Rising Gold Prices: Gold prices surged in January, driven by economic uncertainties and inflation concerns. This directly benefited gold mining companies.
- Investor Sentiment: Investors often turn to gold as a safe-haven asset during times of market volatility. The increased demand for gold led to higher prices and boosted the performance of gold mining stocks.
- Positive Market Trends: The broader market trends and positive sentiment towards precious metals also contributed to the rise.
Prevailing gold prices overwhelmingly drive gold mining profits and, looking at current gold category price levels relative to current price of gold (or silver) bullion provides the extent of under- or over-evaluation of the category.
Below is a summary of how each constituent has performed MTD, in descending order, and in 2024, along with their current Category to Bullion ratio.
Go HERE for a live chart (updated minute-by-minute) of each constituent in the portfolio (Not yet available)
- The VanEck Gold Miners ETF (GDX): UP 8.4% MTD; UP 8.8% in 2024
- consists of producer companies that operate fully functioning mines that extract and sell gold
- # Holdings: 62
- GDX to GLD Ratio: UP 7.2% MTD; DOWN 14.1% in 2024
- The VanEck Junior Gold Miners ETF (GDXJ): UP 7.6% MTD; UP 11.9% in 2024
- consists of developer companies that take over once explorers find a promising deposit conducting feasibility studies to determine if the deposit can be mined profitably, work on securing permits, financing, and planning the construction of the mine.
- # Holdings: 88
- GDXJ to GLD Ratio: UP 4.5% MTD; DOWN 11.5% in 2024
- The Sprott Junior Gold Miners ETF (SGDJ): UP 7.5% MTD; UP 12.6% in 2024
- consists of explorer companies that are searching for new gold deposits
- # Holdings: 40
- SGDJ to GLD Ratio: UP 4.4% MTD; DOWN 11.6% in 2024
- The U.S. Global GO GOLD and Precious Metal Miners ETF (GOAU): UP 5.6% MTD; UP 10.6% in 2024
- consists of companies (merchant “bankers) that provide alternative financing to mining companies by purchasing future production (i.e. streaming) or revenues (royalty) in exchange for upfront cash payments.
- # Holdings: 28
- The Global X Silver Miners ETF (SIL): UP 3.9% MTD; UP 10.9% in 2024
- consists of explorer companies that are searching for new silver deposits by conducting geological surveys, drilling, and sampling and are referred to as “junior” mining companies.
- # Holdings: 35
- SIL to SLV Ratio: DOWN 1.2% MTD; DOWN 7.6% in 2024
Summary
In total, the above 5 gold/silver related ETFs encompass 87% of the gold/silver ‘mining” sector (i.e. 253 companies) and they are UP 6.8% MTD and were UP 11.0% in 2024.
In addition,
- The SPDR® Gold Shares ETF (GLD) is UP 2.9% MTD and was UP 26.7% in 2024 and the iShares Silver Trust ETF (SLV) is UP 4.9% MTD and was UP 20.9% in 2024.
Conclusion
As noted above, the current GDX GGR, for example, is DOWN 14.1% from the end of 2023 to 14.0 and that is absolutely jaw-dropping and, since past super- ow extremes have always been followed by major gold stock up-legs – and gold miners tend to not only mean revert to normal GGR levels, but overshoot proportionally to the upside – that portends to a coming massive surge in gold stocks – and silver stocks, too.
