When it comes to gold miners exchange traded funds, the Market Vectors Gold Miners ETF (NYSEArca: GDX) and the Market Vectors Junior Gold Miners ETF (NYSEArca: GDXJ) are by far the most popular funds in this genre.
That popularity has been bolstered this year and even more so in recent weeks amid a resurgence in gold futures that has boosted mining ETFs. Over the past month, GDX and GDXJ are up an average of 24%. [Junior Miners ETF Looks for New Highs]
To be sure, those are impressive performances, but in terms of pure performance, this year’s best gold miners ETF is one many investors are not familiar with: The Global X Gold Explorers ETF (NYSEArca: GLDX).
GLDX’s stellar 45.7% year-to-date gain not only makes it the best gold miners ETF, but also one of the best non-leveraged ETFs of any variety. GLDX tracks the Solactive Global Gold Explorers Index giving investors “an alternative method of gaining exposure to gold exploration by investing in a basket of companies within the industry.”
GLDX truly is an alternative to other gold miners ETFs. That is to say the ETF’s rewards are far from risk-free. Such is life where the holdings have an average market value of $316 million, which teeters on the fence between micro- and small-cap. Three of GLDX’s top-10 holdings are found in GDXJ, an ETF with a weighted average market value of $600 million. [Small Miners ETF Soars]
GLDX, like the rival GDXJ, has benefited as adventurous investors looking to boost their gains in resurgent gold miners have embraced small-cap fare. GLDX’s country weights are favorable with only Canadian, Australian and U.S. firms appearing in the fund, indicating the ETF is not vulnerable to geopolitical volatility as can be the case for some mining ETFs.
However, GLDX does not lack for volatility. The ETF’s beta against the S&P 500 is 1.19 with a standard deviation of 45%, according to Global X data. The comparable numbers on GDXJ on 0.93 and 44.6%.
That is to say GLDX offers the temptation and potential of big gains in short time frames without leverage. Over the past month, the ETF is up almost 32%. But as veteran traders of miners stocks and ETFs know, this group can taketh away faster than it giveth.
Global X Gold Explorers ETF
