The price of gold is making a comeback. And gold stocks are benefitting.
Gold prices have risen 4% in the last week. During that time, gold stocks have quadrupled those gains, rising 16% since last Wednesday.
That trend continued today. Gold was up 1.75% to reach $1,335 an ounce to start the week. The Market Vectors Gold Miners ETF (NYSE: GDX), which tracks the performance of gold miners, rose 5.8%.
Here are a few gold stocks that really stood out on Monday:
- Harmony Gold Mining Co. (HMY): +9%
- Royal Gold (RGLD): +6.9%
- Eldorado Gold Corp. (EGO): +7.5%
- Yamana Gold (AUY): +7.2%
- Goldcorp (GG): +5.4%
This is a pretty typical pattern. When gold falls, gold stocks typically fall even faster. Conversely, when gold rises, gold stocks shoot through the roof.
Most gold miners have been so beaten down in recent months as the price of gold has fallen that they had little place else to go but up once gold prices bounced back. Gold prices have spiked higher in recent days as economists lowered their forecasts for economic growth in the U.S.
Gold prices have stagnated this year as the U.S. economy has improved. Prices have fallen 20% this year even after the recent rally.
Should the economy hit a snag, however, gold will likely return as an investment safe haven. If gold prices continue to rise, look for gold stocks to advance even faster.