GDXU And The Gold Boom: Timing Is Critical When Turbocharging Mining Stocks

Summary

  • Gold reached a new high of $2,454.20 on the June COMEX futures contract on May 20.
  • Gold mining shares operate on a leveraged model and can outperform gold on the upside and underperform when the price falls.
  • Economic and geopolitical factors support a continuation of rising gold prices, making it a safe-haven asset.
  • GDXU is a leveraged ETN that requires careful attention to risk-reward dynamics.
  • Looking for more investing ideas like this one? Get them exclusively at Hecht Commodity Report. Learn More »
Shiny gold ingots stacked upon each other

LockieCurrie

As it has done so many times in the bull market that began in 1999 at the $252.50 low, gold reached a new $2,454.20 high on the June COMEX futures contract on May 20. The June contract reached $2,448.80 on April 12, and corrected to just

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This article was written by

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Andrew Hecht is a 35-year Wall Street veteran covering commodities and precious metals.

He runs the investing group The Hecht Commodity Report, one of the most comprehensive commodities services available. It covers the market movements of 20 different commodities and provides bullish, bearish and neutral calls; directional trading recommendations, and actionable ideas for traders. Learn more.

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

The author is long gold and gold mining stocks.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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