Related: 31 Gold ETFs Investors Should Size Up
While gold miner stocks and sector-related exchange traded funds look cheap after underperforming broader equities for years, some caution investors against betting too heavily on this area of the market as the sector rallies on strengthening bullion prices.
“On a daily chart of the gold miners ETF (GDX), Gordon points out that the miners have consolidated around $30. He establishes new support levels with $27.50 on the low end and $28.50 on the high end,” according to CNBC.
Gold has acted as a portfolio diversifier, especially in a post-Brexit world where volatility remains elevated. The U.S. dollar is also in a tough spot because the Federal Reserve has yet to raise interest rates this year and does not appear likely to do so.
VanEck Vectors Gold Miners ETF
Tom Lydon’s clients own shares of GDX.