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Wednesday, August 24, 2016

ETF ownership of gold miners: that's not good


There was a guy on BNN this morning talking about gold miners.

He noted that something like 20% of the float of most miners is held within ETFs, such as GDX and ZJG.to.

In the case of B2 Gold, he says it's close to 30%.

That means that ETF flows are going to drive these stocks, and I wouldn't like that if I was in the miners right now, because the minute these hedge fund clowns pile out of the stocks, their prices can go right back down to where they were.

In the long run, though, this is good, because it means if you've already sold off, then in a few months you might be able to buy back your BTO for something like $2.50. Or less.

But for the time being, buying gold miners on fundamentals is a fucking boneheaded idea.


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