Trading Gold Miners... Either Up or Down
Gold recently hit all-time highs because of geopolitical risk, government debt, and inflation. This surge has lifted bullish gold mining ETFs, and Direxion offers a few ways for investors and traders to participate via JNUG, ticker symbol JNUG, pronounced like "J Nug," and NUGT, pronounced like "Nugget."
JNUG and NUGT are two bullish ways to trade gold miners and junior gold miners, respectively. Gold's been on an unbelievable run, fueled by a multitude of factors, whether it's the geopolitical landscape, the US dollar denomination fading in certain places, or inflation running out of control. Gold prices are through the roof as a result, and the gold miners, both major and junior, have profited.
The gold miners typically have larger, more robust operations. There's some overlap with the junior gold miners, but the junior ones tend to be a little deeper in the exploration stages and don't yet have operational mines. If gold prices continue to rise, both sides can profit.
One other piece of the puzzle that traders often overlook with gold miners is oil prices. Oil prices have faced some pressure as well, and the geopolitical landscape has certainly helped on that front. When oil prices are lower, it is easier for these gold miners to both get the gold and to explore new mines. That's been another tailwind in favor of the gold miners this year.
The price of gold and the price of oil have really benefited the bull side of the trade. If you think either one is getting a bit frothy and these gold miners may have a pullback, Direxion offers bear funds as well: DUST and JDST. We offer both sides of the trade on gold miners and junior gold miners, and it's really a matter of what you as a tactical trader believe is the opportunity going forward.
