Gold mining stocks often rally with the price of gold due to the outlook on future profits. However, these stocks can also move with the overall market as well. Which relationship is stronger?
Overall, gold and equities tend to have a relatively weak relationship. Their correlation typically drifts from slightly positive to slightly negative. GDX is the gold miners’ ETF; which tends to have a very strong correlation with gold and a moderately positive correlation with the S&P 500. Have there been times where GDX followed the equity market rather than gold?
Tune in to hear Tom and Tony discuss if gold miners behave more like a stock or commodity!
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