That is good news for GDX because that trio of names represent nearly 20% of the ETF’s weight. Miners are not completely out of the woods, at least not with gold futures merely flirting with $1,330 an ounce. Costs for Gold Fields (NYSE: GFI) are just under $1,300 an ounce while Iamgold (NYSE: IAG) has costs in the $1,200 to $1,300 per ounce range, according to InvestorPlace. Those two stocks combine for 6.7% of GDX’s weight.
Some traders believe $1,200 is the “line in the sand” for gold on the downside. If that level is breached, gold test $1,000. The other side of that coin is that it could take prices moving well above $1,400 an ounce for more investors to feel comfortable owning the miners again.
Market Vectors Gold Miners ETF
ETF Trends editorial team contributed to this piece. Tom Lydon’s clients own shares of GLD.