Today marks the beginning of a new segment on Breakout called "The Trade" where we don't just talk about markets, but tell you the best way to play the day's hottest stories. All opinions are my own. It isn't advice on what to do with your portfolio, your money is your own. The Trade is about explaining the facts at hand and telling you what I'd do with my personal portfolio.
Today's Trade: Market Vector's Gold Miner ETF (GDX), commonly referred to as its ticker symbol. The GDX is designed to trade in line with the fortunes of the most prominent gold mining companies in the world. Companies like Barrick Gold (ABX), Goldcorp (GG) and Newmont (NEM) are three of the largest component companies.
Now that you know what it is here's the story, as discussed with Yahoo! Finance senior columnist Michael Santoli in the attached video. The GDX is more than 5% higher today driven by a more than 2.5% rally in gold prices. The ostensible driver of the gold rally is Ben Bernanke's comments regarding the future of interest rates. As has been the case for the last 18-months, gold needs a specific catalyst to justify a rally and no excuse at all to plunge.
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