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Actionable news in NEM: NEWMONT MINING Corp,

Here's What to Know Before Trading Volatile Gold Stocks

Comex gold was up by 25.5% year to date a month ago, but this gain has been cut to 18.5%. Four of the largest gold mining stocks and the sector-tracking exchange-traded fund continue to outperform the precious metal. However, for the second consecutive month this is by a lower winning margin.

When you compare to the July and August highs, the ETF and all four gold stocks are in bear market territory, down between 25.1% and 37.9%. Gold futures are down 8.8%.

The VanEck Vectors Gold Miners ETF (GDX) trades around $23, up 68.1% year to date and in bear market territory 27.4% below its Aug. 12 high of $31.79. But it is in bull market territory 86% above its Jan. 19 low of $12.40. This exchange-traded fund has 53 components including:

Barrick Gold (ABX) is the largest component of this ETF at a weighting of 9.16%. The stock trades at close to $16, up 114.5% year to date and in bear market territory 32.6% below its July 6 high of $23.47. It is in bull market territory 167.9% above its Sept. 23, 2015 low of $5.91.

Yamana Gold (AUY) has a weighting of just 2.08%. The stock trades around $4, up 100% year to date and in bear market territory 37.9% below its July 13 high of $5.99. It is in bull market territory 169.6% above its Jan. 19 low of $1.38. The stock was an "option on survival" when it traded as low as $1.38 on Jan. 19, by which I mean any stock...


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