Buy NYSE Arca Gold Miners Index
What is GDX?
The GDX is an exchange-traded fund launched in 2006 to mimic the performance (price and yield) of the 50-plus global gold mining companies comprising the NYSE Arca Gold Miners Index.
GDX trades all day, like a stock. It has some $16 billion in assets. About one-third of the fund is invested in four mining companies: Newmont (NEM); Barrick Gold (GOLD); Franco-Nevada (FNV) and Agnico Eagle (AEM).
For the ten-year period ending Sept. 30, GDX's share price has declined about 3% per year on an annualized basis. But in 2020, as of Mid-November, with the price of gold rallying against a weaker dollar, GDX has returned 28%.
It's the industry's first ETF to track gold mining, an industry driven by demand across regions and segments of the market but which also can be subject to macro factors, such as the relative strength of the USD.
However, the worldwide scope and focus on mining of physical gold – to be included, companies must derive at least half of total revenues from gold mining and related activities – make this vehicle attractive on a fundamental basis.
What is the price of GDX?
At roughly $37 per share (as of mid-November 2020), GDX is up 35% over the prior 12 months.
Most online brokerages offer the ETF at zero commission. VanEck collects an annual 0.50% management fee, or $50 per $10,000.
Many analysts are bullish on gold mining stocks, generally, with the prospect of higher inflation owing to monetary policies of the world's central banks. As always, short-term volatility is possible.
VanEck believes there is a compelling opportunity in the space today with gold reaching all-time highs and mining companies healthier than they’ve been at any time in the last 10-20 years.
With continued erosion of financial market underpinnings – monetary policies that have grown extreme, as mentioned, but also other factors, such as negative real rates (after inflation) and sky-high debt levels – the outlook for higher gold prices could not be considered unreasonable, at least not for the foreseeable future.
How to invest in GDX with Uphold
You only need a verified Uphold account to buy GDX stock fast.
Here’s how easy it is to get started:
- Go to Uphold.com and click ‘Sign up’.
- Enter your email address, create a password, and complete an identity check.
- Your account will then be activated, and you can start using Uphold.
You can then fund your account with your debit card, credit card, bank account, or crypto deposit. Your Uphold account can be used to make payments to vendors, send money to friends on the other side of the world, and more.
Uphold’s unique ‘Anything-to-Anything’ trading experience will make any currency exchange a seamless process, all commission-free.
*U.S. stock trading is not available in the U.S., U.K., and certain other jurisdictions.
This article is for informational purposes only and takes no account of particular personal or market circumstances, and should not be relied upon as investment, tax, or legal advice. For investment, tax, or legal advice, and before taking any action you should consult your own advisors. Note that assets such as equities present unique risks for investors.
This content is correct as of October 2020
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