After a disastrous 2013, mining stocks bounced back from their lows at the start of 2014 and are trending higher. Commodity prices, in particular gold and silver, have risen sharply this year, as concerns on global economic growth and Fed tapering plans once again increased the safe haven appeal.
This is especially true given signs of slowdown in China and depressed emerging markets. Trading in emerging markets has been rough of late on growing political and financial instability in many nations as well as sliding currencies. Further, falling equity markets are bolstering the demand for metals.
This turnaround has finally shifted focus on the mining space, leading to some strong performances in the broad commodity world. Given this broad rally, the miners, who are often leveraged to the price changes of their underlying commodities, have started gaining traction.
In fact, many mining ETFs have lately seen a spike with several gaining nearly double digits from a year-to-date look, suggesting that the bullish trend could continue for at least in the near term. Below, we have highlighted three mining ETFs that are leading the way in 2014 but are rather unknown within the space.
Any of these could be excellent plays for investors seeking to ride this sudden move in the metal mining space even higher (see: all the materials ETFs here):
PureFunds ISE Junior Silver ETF (NYSEARCA:SILJ)
This product provides a true small cap play on the silver mining space. The fund has managed assets worth $1.7 million and trades in a paltry volume of less than 5,000 shares a day. The ETF charges 69 bps in annual fees. The product tracks the ISE Junior Silver Small Cap Miners/Explorers Index.
In total, the fund holds about 24 companies with the largest allocation going to top three firms – Fortuna Silver Mines (FSM), Endeavour Silver (EXK) and Silvercorp Metal (SVM) – which make up for nearly 12% each. In terms of country exposure, Canadian firms dominate the fund at 74% while U.S. securities make up for a 25% share. SILJ added over 18% in the year-to-date time frame.