Disconnect between the price of Gold and Gold Stocks?
It looks like gold stocks like Yamana and Gold Corp. are trading like they were when gold was at $600 an ounce. Now it's at $800 (33% higher) and these stocks are still beaten down. This looks like a great buying opportunity -- unless I'm missing something. Who thinks this makes sense, why or why not?
Answers
2703 points
MNSL answered 3 months ago …
Recently one-research house upgraded from market perform to outperform.
However, I think there will further downside in prices of gold stocks, coal stocks and oil stocks at least for the next 04 months. Month of October will be more crucial for the commodity market. I think there will big sell off sooner than later.
Gold companies like Barrick (ABX) and Yamana (AUY) recently hit new 52-week lows
Macroeconomic and geopolitical uncertainty also affecting prices of gold and other commodities now.
In short, it is better to sell all types of mining stocks now. Bull market for these commodity stocks are over now. They are in the bear market tertiary now. This is the time to readjust our portfolio for better returns.
Intelligent investors disposed their all types of mining stocks and other commodity stocks in July this year.
There will be more pain in the gold and other commodities sooner than later.
2703 points
MNSL answered 3 months ago …
Recently one-research house upgraded AUY from market perform to outperform.
Read more from MNSL flag as abuse great answer
3127 points
EthanR answered 3 months ago …
Rob, I compared the performance of GG, AUY, and GLD over the last 200 days, 90 days, 60 days, and 30 days. Of the three, GLD did the best, just slightly better than GG. AUY was a distant third. So if you decide to buy gold stocks, I would suggest you not by AUY, and buy either GLD or GG instead.
As for is this the right time, the indicators are mixed. Looks like a short term bottom could be in place, but I am not wildly enamored with this sector right now.
493 points
warren answered 2 months ago …
The disconnect results from the stocks being leveraged to the gold price. We haven't yet seen this reflected so much on the upside but it is extremely apparent on the downside. It is time to enter these stocks...in stages. SLW is a great one today as is NDM. Most majors too. Butg there are some screaming deals out there today. Please sign up for my free weekly newsletter which will talk in depth about the major fundamentals for gold and silver this week...and they haven't gotten worse.
This investment is long term, but it will pay off in spades. Trading in and out constantly is not my style in this bull market.
Warren,
www.preciousmetalstockreview.com
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