Equity: Global Gold Miners

GDXJ Top Performer Intra-day
Price $36.20
Today’s Change -0.06%(-0.17)
4:00pm 03/24/2017
SGDM Bottom Performer Intra-day
Price $20.38
Today’s Change -0.13%(-0.63)
3:59pm 03/24/2017
  • Overview
  • Efficiency
  • Tradability
  • Fit

ETF.com Insight

The Global Gold Mining segment is dominated by 2 funds. Only GDX and GDXJ are practical trading tools, and they hold about 96% of the assets invested in the segment. Anyone employing aOnly GDX and GDXJ are practical trading tools tactical strategy using the segment will likely use GDX and GDXJ. GDX's deep options market sets it apart from peer funds too.
That said, issuers have done a good job providing distinct exposure across the funds in the segment. GDX tracks a small, highly concentrated index of the largest gold and precious metals mining firms traded in the US. RING is more concentrated at the top than GDX, but aligns better with our MSCI benchmark for the space. RING earns our nod as the segment's analyst pick for its comprehensive global coverage of the industry, although it's no match for GDX in size and liquidity.
The remaining funds target specific slices of the industry. GLDX is risk-seeking, holding exploration stage firms, an approach that's fared better (or hurt less) than pure play exposure. GDXJ also holds riskier firms but targets them based on firm size, not business stage. GDXJ also earns a spot on our opportunities list, for its exclusivity to the small-cap space.
PSAU's broad portfolio covers the entire precious metals complex, not just gold mining. Like GDX, its top 10 holdings include silver mining powerhouse Silver Wheaton. SGDM aims for firms with high beta to the price of gold. SGDM has successfully gathered a reasonable asset base, while its sibling SGDJ and some older funds have struggled to attract assets. We see closure risk for PSAU, SGDJ and GLDX.
Lastly, we note the high volatility and negative returns recently for this beaten down space. We find negative P/E ratios for all segment funds too, meaning firms in this space have lost money in aggregate. (Insight updated 03/24/17)

All Funds (8)

RING $149.87 M 149871825 cheap, best fit

A 99
E
93
93
T
86
86
F
99
99

SGDM $197.46 M 197463440 high beta to gold

A 64
E
100
100
T
92
92
F
64
64

GDXJ $5.53 B 5531850285.7288 popular

B 53
E
87
87
T
88
88
F
53
53

PSAU $36.82 M 36815000 closure risk

C 88
E
84
84
T
55
55
F
88
88

GDX $11.9 B 11898939374.75 biggest, most liquid

C 80
E
67
67
T
96
96
F
80
80

GOEX $46.43 M 46427725.414029 closure risk

D 46
E
74
74
T
24
24
F
46
46

SGDJ $54.14 M 54142430 trades weakly

N/A 0
E
0
-1
T
0
-1
F
0
-1

GLDX $80.16 M 80159331.640663 closure risk

C 44
E
67
67
T
80
80
F
44
44

ETF.com Grade as 03/16/17

Equity: Global Gold Miners

1 Year Total Return NAV
Performance  [as of 03/23/17] 1 Month 3 Month YTD 1 Year 3 Years 5 Years 10 Years
Benchmark: MSCI ACWI Select Gold Miners Investable Market Index-5.37%20.92%10.15%18.39%-3.02%-14.47%--
A 99.102467RING149871825RINGiShares MSCI Global Gold Miners ETF-5.58%-1.09%93.36%16.72%-3.69%-14.49%--
A 64.236306SGDM197463440SGDMSprott Gold Miners ETF-5.48%17.47%8.75%14.61%------
B 53.393729GDXJ5531850285.7288GDXJVanEck Vectors Junior Gold Miners ETF-11.39%26.69%14.93%42.58%-0.92%-16.43%--
C 87.823287PSAU36815000PSAUPowerShares Global Gold & Precious Metals Portfolio-5.52%21.18%11.95%19.39%-2.67%-12.59%--
C 79.691844GDX11898939374.75GDXVanEck Vectors Gold Miners ETF-5.50%19.08%10.09%21.37%-2.77%-13.66%-4.70%
D 45.871798GOEX46427725.414029GOEXGlobal X Gold Explorers ETF-8.86%29.25%14.78%48.93%5.81%-13.31%--
N/A 0SGDJ54142430SGDJSprott Junior Gold Miners ETF-10.93%21.18%8.44%27.71%------
C 44.055060145694GLDX80159331.640663GLDXGlobal X Gold Explorers ETF-11.73%10.28%136.28%130.86%11.90%-17.83%--
All returns over 1 year are annualized. All returns are total returns unless otherwise stated.

ETF.com Efficiency Insight

Holding costs and assets help to differentiate the funds in the Global Gold Miners segment.
RING charges the lowest fee in the segment. Just as important, it tracks its underlying indexSmall asset bases drive concerns about viability so well that investors' typical annual holding cost is less than this fee. GDX and GDXJ charge higher fees but typically cost less to hold than their fees suggest. The tracking volatility shown in upside/downside numbers reflects these funds' use of fair value NAVs, a practice which minimizes apparent premiums and discounts but hurts tracking statistics (with no effect on actual performance).
GLDX stands at the other end of the spectrum for holding cost and tracking. It charges one of the highest fees in the segment. Worse, it tends to lag its index with great variability. Fair value isn’t a factor for GLDX.
More recent launches SGDM and SGDJ charge middle fees. We'll see how well they track their indexes with time.
Regarding AUM, GDX and GDXJ shine with multibillion dollar asset bases. The remaining funds are far smaller. Small asset bases drive concerns about viability. We currently see fund closure risk for GLDX, SGDJ and PSAU. To its credit, SGDM only launched in 2014 but has leapfrogged past some of these smaller funds in assets. (Insight updated 03/24/17)

All Funds (8)

93
92.812522
87
86.641558
84
83.606346
74
74.178794
67
66.737888
100
100
N/A
0
67
66.834950606161

ETF.com Grade as 03/16/17

Equity: Global Gold Miners

Tracking Difference (12 Month)

Ticker Expense Ratio Median Max. Upside Max. Downside Max LT/ST Cap Gains Rate Rule Legal Structure Fund Closure Risk Efficiency
GDX VanEck Vectors Gold Miners ETF 0.52% -0.17% 2.67% -1.89% 20.00% / 39.60% Low 66.737888
GDXJ VanEck Vectors Junior Gold Miners ETF 0.56% -0.18% 0.71% -1.30% 20.00% / 39.60% Low 86.641558
PSAU PowerShares Global Gold & Precious Metals Portfolio 0.75% -0.99% 0.07% -2.18% 20.00% / 39.60% Low 83.606346
RING iShares MSCI Global Gold Miners ETF 0.39% 0.14% 0.69% -0.35% 20.00% / 39.60% Low 92.812522
SGDJ Sprott Junior Gold Miners ETF 0.57% -1.70% -0.61% -3.17% 20.00% / 39.60% Low 0
SGDM Sprott Gold Miners ETF 0.57% -1.22% -0.77% -2.36% 20.00% / 39.60% Low 100
GOEX Global X Gold Explorers ETF 0.66% -1.40% 1.93% -5.67% 20.00% / 39.60% Low 74.178794
GLDX Global X Gold Explorers ETF -1.11% 1.14% -5.67% 20.00% / 39.60% Low 66.834950606161

ETF.com Tradability Insight

GDX leads the segment in liquidity, and can be fairly traded by investors of all stripes. The fund gets more daily volume than the rest of the segment combined, and the liquidity of theGDX gets more daily volume than the rest of the segment combined underlying portfolio makes it extremely easy for APs to hedge. Spreads average just a penny. In addition, there is enough activity in GDX options to make them a useful tool for more sophisticated investors looking to hedge or overlay their ETF positions or to extend the ETF's liquidity.
GDXJ has plenty of liquidity for most investors as well, and would be the clear standout were it not for GDX. Spreads are also just a penny wide, and millions of shares change hands daily. We rate GDXJ highly in block liquidity due to its massive on-screen liquidity. Still, price impact can be a concern if actual creates/redeems are needed because the small-cap nature of GDXJ's holdings means a creation-unit-sized trade represents a significant chunk of underlying volume.
The next most liquid fund is SGDM, which sees enough volume for most retail investors, at spreads that are manageable if not truly tight. SGDM is the only other fund besides GDX and GDXJ to get a perfect sore in block liquidity.
At the other extreme: GLDX and PSAU. Both funds trade with slim volume and wide spreads. GLDX suffers in block liquidity too due to extremely poor underlying liquidity—don't expect economies of scale here. (Insight updated 03/24/17)

All Funds (8)

96
95.850299
92
91.945939
88
88.018216
86
85.676297
55
54.657054
24
23.771712
N/A
0
80
79.552154167585

ETF.com Grade as 03/16/17

Equity: Global Gold Miners

Ticker Median Daily Volume ($) Average Spread Creation Unit/Day Market Hours Overlap Underlying Volume/Unit % Creation Cost Per Unit (%) Impediment to Creations Score - Tradability
PSAU PowerShares Global Gold & Precious Metals Portfolio $296.18 K 0.60% 0.29 72.00% 0.12% 0.10% None 54.657054
RING iShares MSCI Global Gold Miners ETF $2.11 M 0.30% 2.23 77.00% 0.19% 0.08% None 85.676297
SGDJ Sprott Junior Gold Miners ETF $455.53 K 0.60% 0.26 100.00% 1.20% 0.03% None 0
SGDM Sprott Gold Miners ETF $1.6 M 0.19% 1.45 100.00% 0.13% 0.05% None 91.945939
GOEX Global X Gold Explorers ETF $397.71 K 1.15% 0.33 82.00% 5.01% 0.08% None 23.771712
GDX VanEck Vectors Gold Miners ETF $1.33 B 0.04% 1,111.05 85.00% 0.09% 0.04% None 95.850299
GDXJ VanEck Vectors Junior Gold Miners ETF $703.34 M 0.03% 361.48 84.00% 0.74% 0.05% None 88.018216
GLDX Global X Gold Explorers ETF $1.88 M 0.90 89.00% 0% 0.06% None 79.552154167585
Spread History
Premium/Discount History

ETF.com/ Block Liquidity

RING
5
4
3
2
1
SGDM
5
4
3
2
1
GDX
5
4
3
2
1
GDXJ
5
4
3
2
1
PSAU
5
4
3
2
1
SGDJ
5
4
3
2
1
GOEX
5
4
3
2
1
GLDX
5
4
3
2
1

This measurement shows how easy it is to trade 25,000 shares of each ETF.

ETF.com Fit Insight

The segment funds provide distinct exposure, allowing investors to pick the one that best suits their needs. RING provides the best neutral exposure in the segment, based on our view of theRING provides the best neutral exposure in the segment global gold mining industry. It is highly concentrated to be sure, with roughly 1/3 in just three firms (Goldcorp, Newmont and Barrick) and about 2/3 in the top 10 holdings. This marketlike exposure still produces a portfolio with negative aggregate earnings for the stocks—something currently seen in every fund in the segment. Still, RING’s industry balance and firm size distribution accurately represent the industry.
GDX looks similar to RING on paper, with roughly the same number of stocks, dominated by Goldcorp and Newmont. However, while you get exposure to the biggest names in the industry, you also get some hefty exposure to firms mining precious metals other than gold.
Investors seeking exposure to those smaller names can get it in GDXJ, GLDX or SDGJ. GDXJ explicitly targets small and micro-cap precious metals mining firms—those mining gold as well as silver, platinum and palladium—a group that includes exploration and early-stage production firms. GLDX ratchets up the risk even more, holding only exploration firms, most of them micro-caps. Meanwhile, SGDJ weights its small-cap portfolio by a combination of recent revenue growth and price momentum.
PSAU targets a broad mix of global precious metals mining firms, not just gold miners. While some might like this diversification, only about 2/3 of the portfolio is in what we define as gold mining companies. We see similar industry biases in SGDM, which explicitly targets stocks with a high sensitivity to the price of gold. The fund also screens for high revenue growth and low financial leverage in for the issuers of the stocks it holds.
The variety of exposures offered in the segment ultimately benefits investors looking to tailor their exposure to suit their needs. The differences highlighted here drive the divergence of performance seen on the overview tab. Those without strong views on nuances within the space might be best served with the neutral exposure offered by RING, or perhaps GDX. (Insight updated 03/24/17)

All Funds (8)

99
99.102467
88
87.823287
80
79.691844
64
64.236306
53
53.393729
46
45.871798
N/A
0
44
44.055060145694

ETF.com Grade as 03/16/17

Equity: Global Gold Miners