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Sprott Gold Miner ETFs
Get More Out Of Your Gold Allocation

Why Gold Stocks?

For investors with a positive view on the price of gold, they may want to consider adding gold stocks to their overall precious metals allocation.

Gold stocks are sensitive to the price of gold because of their inherent operating leverage. As the price of gold rises it typically translates into higher profits for a gold company. As you can see from the table below, the annual returns from gold stocks have been pronounced relative to the price change of gold.

  2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Gold 2.46 24.78 19.37 5.54 17.92 23.16 30.98 5.78 24.37 29.52 10.06 7.14 -28.04 -1.72 -10.42 8.56
Gold Stocks* 59.14 122.58 67.40 -11.36 28.59 22.15 21.03 -26.13 42.16 33.36 -13.01 -10.93 -55.50 -17.03 -32.22 63.98
*NYSE Arca Gold Bugs Index

How to Invest in Gold Stocks?

For most investors, we suggest they take a diversified approach when investing in gold stocks because of the company specific risk when investing in an individual stock. A popular and convenient way to invest in a basket of stocks is through exchange traded funds or ETFs. Like mutual funds, ETFs provide diversification of holdings but with the added benefits of providing intraday liquidity (the ability to buy and sell throughout the trading day) and lower management fees.

In partnership with ALPS Advisors, Inc. and ALPS Distributors, Inc. Sprott offers two gold mining ETFs. The Sprott Gold Miners ETF (NYSE Arca: SGDM) and the Sprott Junior Gold Miners ETF (NYSE Arca: SGDJ). 

 

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