“Thus far into 2012, gold is up 6.12 % , while the miners have fallen an average of 3.41 %. Moreover, over the last six months some miners are down 14.66 %, while gold is down 8.36 %, reports ZVI Bar on Seeking Alpha.
Risks that mining companies face that do not affect gold prices are geographical risk, political risk, mine productivity issues, weather, fraud and management problems. However, going forward, any further rise in gold prices should prove favorable for mines. [Gold Miner ETFs Lose Their Luster]
Many gold mining share are selling off at a leveraged rate compared to the actual metal. If gold prices stay where they are at or rise, the gap between gold prices and miners should even out.
- Market Vectors Gold Miners ETF (NYSEArca: GDX)
- Market Vectors Junior Gold Miners ETF (NYSEArca: GDXJ)
Market Vectors Gold Miners ETF
Tisha Guerrero contributed to this article.