ETF Trends
ETF Trends

Gold miner exchange traded funds were hit with a double whammy on Monday as stocks and precious metals weakened on concerns Europe will slip into recession despite last week’s ECB moves.

Market Vectors Gold Miners (NYSEArca: GDX) and Market Vectors Gold Miners (NYSEArca: GDX) were down more than 4% to start the week. [Europe Woes]

GDX dropped below its 200-day moving average on Monday. GDXJ is designed to follow small-cap miner stocks.

Investors should understand that gold and gold stocks “are entirely different markets that share different performance in a panic or crisis,” said Jordan Roy-Byrne at The Daily Gold, in a recent report. “Gold can be a safety hedge, but gold stocks most certainly are not. They are the worst performers in any type of crisis.” [Miners Fall Harder Than Gold]

Some investors are getting frustrated with how badly miner stocks have trailed gold bullion in recent years. Gold has rallied 162.28% over the past five years versus GDX up 42.07% during the same time period, according to Street One Financial. [ETF Chart of the Day: Miners]

The opinions and forecasts expressed herein are solely those of John Spence, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.