Amid President Donald Trump’s trade war with China and now a new front with Mexico, gold has started to reclaim its status as a safe haven.
Last week Trump tweeted: “On June 10th, the United States will impose a 5% Tariff on all goods coming into our Country from Mexico, until such time as illegal migrants coming through Mexico, and into our Country, STOP.”
Upcoming tariff’s on Mexican goods combined with China’s recent threat to decrease exports of rare earth metals has stoked fears of an impending recession.
In response to the global uncertainty, “gold futures for August (GC=F) jumped 1.45% to reach a seven-week high and post their first monthly gain in four months,” according to Investopedia.
Despite optimism about gold, investors are looking for additional signs before diving head first.
For one Bill Baruch, President of Blue Line Futures, would like to see silver prices move higher. Secondly, strategists like Colin Cieszynski, said they would like to see gold trade higher. Cieszynski, Chief Market Strategist, at SIA Wealth Management, told kitco.com that a “weekly close above $1,303 an ounce [would] help to instill some confidence in the marketplace, but he added that he would like to see some follow-through buying that would push prices above $1,310.”
Investors will need to keep a pulse on a number of economic trends before deciding if now is the time to get into gold. When the time is ripe, investors looking to seek gold exposure can consider these gold ETFs.
Direxion Daily Gold Miners Index Bull 3X Shares (NUGT)
NUGT seek daily investment results, before fees and expenses, of either 300% or 300% of the inverse (or opposite) of the performance of the NYSE Arca Gold Miners Index, according to the fund’s fact sheet. “The NYSE Arca Gold Miners Index (GDMNTR) is a modded market capitalization weighted index comprised of publicly traded companies that operate globally in both developed and emerging markets, and are involved primarily in mining for gold and, to a lesser extent, in mining for silver.” With a net expense ratio of 1.23%, the fund’s overview highlights that the leveraged ETF seeks a return that is 300% or -300% of the return of their benchmark index for a single day.
Direxion Daily Junior Gold Miners Index Bull 3X Shares (JNUG)
JNUG seeks daily investment results, before fees and expenses, of 300%, or 300% of the inverse (or opposite), of the performance of the MVIS Global Junior Gold Miners Index. “The MVIS Global Junior Gold Miners Index (MVGDXJTR) tracks the performance of foreign and domestic micro-, small- and mid-capitalization companies that generate, or demonstrate the potential to generate, at least 50% of their revenues from, or have at least 50% of their assets related to, gold mining and/or silver mining, hold real property or have mining projects that have the potential to produce at least 50% of the company’s revenue from gold or silver mining when developed, or primarily invest in gold or silver,” according to the fund’s fact sheet. The fund has a net expense ratio of 1.17%. Similar to NUGT, the JNUG’s fact sheet also notes that it seeks a return that is 300% or -300% of the return of their benchmark index for a single day.
VanEck Vectors Gold Miners ETF (GDX)
GDX follows as closely as possible, before fees and expenses, the price and yield performance of the NYSE Arca Gold Miners Index (GDMNTR). The index tracks the overall performance of companies involved in the gold mining industry. The fund’s net expense ratio is 0.52%.
Find the latest news and trends in gold exchange-traded funds (ETFs).
