Miners follow precious metals up

Miners follow precious metals up

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Gold is up $17 or over 1% to a fresh ATH of $1475 and silver made a 3% quantum leap of $1.28 not only passing the $40 mark but leaving it behind.
Miners follow the precious metals up, in spite of general stock market weakness with crude soaring against a continuous retreat of the greenback.
Gains outnumber losses by 5:2 on our GoldMinerPulse (GMP) miners list, which means that we have a considerable number of drop-outs not at the party!

Index vastgoedcertificaten topt boven 65.000

De Petercam returnindex van de vastgoedcertificaten (BRECS) topt op het eind van het voorbije kwartaal net boven 65.000. De returnindex gaat terug tot eind 1985 en is toen gestart aan 10.000. Door het hoge dividendrendement van vastgoedcertificaten komt een groot deel van de stijging op rekening van de uitbetaalde coupons. De koerswinsten ogen wel mooi voor enkele certificaten met winkelcentra als onderliggend vastgoed. De nog noterende kantoorcertificaten hebben het vrij grondig verkorven. Enkel bij Beaulieulaan en Zenobe Gramme (beide rond €170) houdt de certificaathouder van het eerste uur nog  2/3 van zijn beginkapitaal over. Bij de overige kantoorcertificaten past eerder de omschrijving 'catastrofaal'.

Junior Precious Metal Miners Outperform

Don't they?
After a previous posting on the junior mining index, the obvious question was: do juniors outperform majors? Do they consistently do so? Do juniors also outperform precious metals over the long haul ? There is at least one thing for sure:

Large Miners underperform precious metals
There is plenty of evidence that major gold stocks could not keep up with the rising price of gold. Measured by the HUI/Gold or XAU/Gold metric, major gold stocks manifestly lost track of the gold price evolution on two occasions (See refs: 1, 2):

• at the end of the 20 year bear market in 2000, gold stocks ultimately got shattered as gold bullion bottomed at $250/oz,
• during the autumn 2008 market implosion, major gold stocks dropped vastly more than bullion, which bottomed out barely above $700, losing about 30%, relative to the March-08 peak above $1000/oz.

Major gold stocks never regained their pre-crash value relative to gold. Major silver stocks aren't any better as was shown in a previous posting (Ref. 3). Note that for both gold and silver miners, you may find some happy exceptions to the unpleasant average.

Precious metal mining indices (as HUI or XAU) are composed of mining majors only. So what about junior miners? Do they on average perform any better than large miners? Do they consistently outperform ?

In a previous posting (Ref 4) I have been checking the MVGDXJ, the benchmark index used by the popular GDXJ junior precious metal mining ETF (discussed in an earlier posting: ref. 5, 6).

Novagold

This page contains links to press releases and articles on NOVAGOLD (company website).

Becoming a Pure Gold Play Focused on Donlin Gold

NOVAGOLD offers an unrivaled opportunity for investors seeking leverage to gold. The Donlin Gold project is a uniquely attractive asset which in terms of size, grade, exploration potential, production profile, and jurisdictional safety, is quite possibly the most important project in the world today. NOVAGOLD is well-funded with a cash balance of approximately US$206 million as of August 31, 2013, sufficient to fulfill all of its current financial obligations as well as fund the advancement of Donlin Gold through the permitting process.

Post 2008 lows for miners relative to precious metals

When looking at the relative price level of precious metal miners - as determined by the HUI/Gold ratio, it seems little plausible that gold is in fact barely below its all time high: PM miners look as if their revenues have been falling dramatically. Have investors been dropping their once beloved mining stocks in utter despair?

A Junior Gold Mining Index

March 7, 2011

Those investing in junior gold miners or explorer/developers may scan through their own little universe of stocks they have invested in or are planning to do so. They certainly look at graphs providing the necessary view on historic performance, they compare stocks against one another, but unlike gold mining majors followed by a few precious metal mining indices, there isn’t really an accepted benchmark for juniors. You can read below my comment on this problematic topic:

Silver miners underperforming silver bullion?

As is demonstrated in several articles (1), gold mining majors don’t offer any leverage over gold bullion. Outperformance during gold rallies is largely undone by major swoons during gold retreats. The return for your bravery when investing in gold mining majors is merely additional volatility and underperformance over the long haul. But what about silver miners? Do we observe something similar?

Marcel Thirylaan: Double and Quit ?

Het is niet ongewoon dat de koers van een liquidatie-vehikel zeer sterk fluctueert. Sinds de uitkering van de eerste vereffening eind november 2010 (€45.27), hoort Marcel Thirylaan tot deze categorie. De activa bestaan uit een ingehouden bedrag op het liquidatiesaldo. Na de verkoop van het gebouw (zie ook: Kogel  door de kerk) is de opbrengst van het erfpachtrecht uitgekeerd aan de certificaathouders. Overige rechten (meer dan €300.000) zijn ingehouden om de lopende gerechtelijke geschillen te kunnen bekostigen. De mogelijke inkomsten daarvan kunnen de activa verveelvoudigen.

GDXJ or GLDX, what to choose in the Gold Exploring Realm?

Note: the ticker of the Global-X Gold Explorer ETF has changed to GOEX in 2016.

Decades of underperformance

Gold investors may not like this, but the main Gold & Silver miners index, that has been around for a while, exhibits decades of underperformance.
The gold miners index most referenced now is the "Unhedged Gold Bugs index" with ticker ^HUI. You can find data on Yahoo going back to 1996 for this index. However the Philadelphia Gold & Silver Miners index (ticker ^XAU) goes back way before this. Yahoo posts XAU data from 1983 onwards, but the index may be older than that. One main difference between the two is the inclusion of Freeport McMoran in the Philadelphia Gold & Silver Miners index, with a heavy weight of about 13%.
Recently I've focussed on how the HUI does outperform bullion during the gold rallies, but still fails to catch up since it fell into the abyss back in October 2008. See: Did you say leverage?
As for now I will focus on the Philadelphia Gold & Silver Miners index, abbreviated XAU henceforth.