Gold ETFs have also been grappling with the surprising results of the U.S. presidential election. Investors widely expected gold to rally if Republican Donald Trump won the presidential election in November, which he did, but that thesis proved incorrect. Democratic challenger Hillary Clinton may have actually been the preferred victor for gold ETFs because historical data suggest gold performs better when Democrats are in the White House.
Markets are pricing in multiple rate hikes from the Federal Reserve this year, but the no long the Fed holds off on boosting borrowing costs, the better for no-yield assets, such as gold and other precious metals.
“At a certain point in time, gold will turn again into a loved asset. In other words, the current long term bear market will turn into a bull market,” according to ETF Daily News.
Active traders that are not afraid of leverage can use ETFs such as the Direxion Daily Gold Miners Bull 3X Shares (NYSEArca: NUGT) and the Direxion Daily Junior Gold Miners Index Bull 3X Shares (NYSEArca: JNUG).
For more information on the gold market, visit our gold category.