Chanin explained how mining companies have come and gone, but mining services providers, or “the guys selling the picks and shovels,” are still strong. Investors can liken the miner service and equipment space to miner stocks with energy service and equipment space to energy stocks.
Moreover, MSXX comes with a 4.89% 30-day SEC yield.
“The miner service and equipment ETF is the best way to get a dividend play on the mining space,” Chanin added. “The ETF provides a high yield play with exposure to metals and mining space.”
The money manager also provides the only diamond mining related ETF, the PureFunds ISE Diamond/Gemstone ETF (NYSEArca: GEMS). GEMS is up 7.7% over the past month. [A Diamond Miners ETF for Precious Gems]
Country allocations include UK 28%, Hong Kong 25%, Canada 20%, US 15% and Japan 7%. Top holdings include Chow Tai Fook Jewelry 8.6%, Petra Diamonds 8.0% and Anglo American 8.0%.
For more information on the mining sector, visit our metals & mining category.
Max Chen contributed to this article.
Full disclosure: Tom Lydon’s clients own SLV.