Physically-backed gold exchange traded funds are trading lower by about 1% today, sending the SPDR Gold Shares (NYSEArca: GLD), iShares Gold Trust (NYSEArca: IAU) and ETFS Physical Swiss Gold Shares (NYSEArca: SGOL) to the 52-week low club.
Predictably, that is bad news for gold miners ETFs, plenty of which are also dotting the ETF 52-week low lineup today. At least five gold miners ETFs hit new lows Friday. After the Global X FTSE Greece 20 ETF (NYSEArca: GREK), the next worst ETFs in terms of intraday percentage losses are gold or silver miners funds. Unfortunately for gold bugs, those factoids are not an end to the ongoing downward spirals for mining stocks and ETFs. [Gold Miners ETFs for the Contrarian Investor]
The Market Vectors Gold Miners ETF (NYSEArca: GDX) and the Market Vectors Junior Gold Miners ETF (NYSEArca: GDXJ), the two largest gold miners ETFs by assets, are both off 3.9% at this writing, bringing their year-to-date declines to 15.6% and 11.4%, respectively. Those losses have been accelerating in recent weeks. For example, GDXJ has shed 18% over the past month.
The charts are ominous. Chris Kimble of Kimble Charting Solutions notes the NYSE Arca Gold Bugs Index (HUI), which is not the index tracked by GDX or GDXJ, has “been forming a bearish descending triangle pattern. The Gold bugs index is taking out the bottom of the pattern, applied a measured move to the pattern. Gold bugs could shrink another 30%.”
That might one reason why investors have yanked nearly $300 million combined from GDX and GDXJ since the start of the second quarter. However, as is often the case, outflows from those ETFs are coupled with inflows to their leveraged counterparts.
Over the past month, Direxion Daily Junior Gold Miners Index Bull 3x Shares (NYSEArca: JNUG) and the Direxion Daily Gold Miners Bull 3X Shares (NYSEArca: NUGT), which take the 3x or 300% daily performance of a group of large gold miners and junior miners, are off an average of 47%.
The recently launched ProShares Ultra Gold Miners (NYSEArca: GDXX) and ProShares Ultra Junior Miners (NYSEArca: GDJJ), take the 2x or 200% daily performance of large miners and junior miners, are off an average of 34% over that period. [Gold Miners ETF Field Expands With Double-Leveraged Funds]
Those glum performances have not stopped investors from pouring almost $374 million into NUGT since the start of the second quarter. The Direxion Daily Gold Miners Bear 3X Shares (NYSEArca: DUST) and the Direxion Daily Junior Gold Miners Index Bear 3X Shares (NYSEArca: JDST) are up an average of 75% over the past month, but investors have pulled a combined $63.4 million from those ETFs since the start of the second quarter.
The double-leveraged rivals to DUST and JDST, the ProShares UltraShort Gold Miners (NYSEArca: GDXS) and the ProShares UltraShort Junior Miners (NYSEArca: GDJS) are each up about 45% over the past 30 days.
Gold Bugs Chart
Chart Courtesy: Kimble Charting Solutions