Dueling Views on Gold Miners

Gold mining exchange traded funds, one of last year’s most widely followed and worst performing segments of the ETF universe, are getting plenty of attention again this year.

Fortunately for beleaguered investors, most of the news has been favorable. Helped by rising gold prices, which have translated to a 3.2% year-to-date gain for the SPDR Gold Shares (NYSEArca: GLD), mining stocks and ETFs have been notably better in 2014.

At various points last year, seven or eight of the 10 worst non-leveraged ETFs were related in some form to gold and silver and several of those funds were equity-based mining plays. This year, the Global X Gold Explorers ETF (NYSEArca: GLDX) and the Market Vectors Junior Gold Miners ETF (NYSEArca: GDXJ) each rank among the 10 best non-leveraged ETFs. GDXJ and GLDX were each reverse split last year due to tumbling share prices. [Gold Rebound Powers Mining Stocks]

The Market Vectors Gold Miners ETF (NYSEArca: GDX), the largest gold mining ETF by assets, has gained nearly 6% since early December and has peaked above its 50-day moving average since for the first time since early November. [Little Love for Gold Miners ETF]

These embattled ETFs are not only benefiting from rising gold prices, but from an array of bullish calls. GDX gained a bull call in December as one market observer astutely pointed out that one year’s laggard sectors often turn into the next year’s leaders. History has shown this scenario does play out time and again and while there is plenty of time in 2014 for mining ETFs to stumble, these funds are certainly off to strong starts. [Friend Fear With ETFs]