Over $1 Billion Has Flowed Out Of The GDX This Week Alone

Outflows have picked up a bit in the largest Gold Miner equity fund GDX (VanEck Vectors Gold Miners, Expense Ratio 0.52%) this week, with more than $1 billion leaving the fund via redemption flows thus far.

As we mentioned, GDX is not alone, as GDXJ (VanEck Vectors Junior Gold Miners, Expense Ratio 0.56%) has also been pressured lately with some outflows ($370 million out). Both funds have fallen precipitously in recent sessions, and are under selling pressure again this morning (GDX trading at its lowest level since mid-March) on lower Gold prices lately.

Interestingly, the U.S. Dollar has been trading flat as of late, so we are not quite sure what to make of this recent sudden selloff in Gold and other Precious Metals, as Silver for instance has not been spared in the past couple weeks either. Reference SLV (iShares Silver Trust, Expense Ratio 0.50%), which is down over 9% in the past five trading sessions alone.

We will point out, however, that Commodities in general have had a very hard time in the past several weeks, and this certainly has put pressure on everything from Crude Oil to Gold and the Precious Metals, for if we look at a diversified fund like DBC (PowerShares DB Commodity Index Tracking, Expense Ratio 0.85%), where Gold has about a 7% weighting, the fund has been pounded since mid-April continuously.

The largest Gold tracker, GLD (SPDR Gold, Expense Ratio 0.40%, $34.7 billion in AUM), has still managed year-to-date inflows of about $1.3 billion, although it feels like stops have gone off in the fund since GLD blitzed through it both its 200 and 50 day MA’s in a matter of just two sessions (yesterday and Tuesday), and is gapping lower today once more. The chart on SLV looks even more ghastly, as the fund has a current streak of fourteen straight down days, if today’s losses hold.

Since we are watching the Gold Miners amid this market activity, we should also be conscious of the lesser known and smaller Silver Miner funds such as SIL (Global X Silver Miners, Expense Ratio 0.65%, $330 million in AUM), SLVP (iShares MSCI Global Silver Miners, Expense Ratio 0.39%, $62 million in AUM) and SILJ (Pure Funds ISE Junior Silver, Expense Ratio 0.69%, $59 million in AUM), as well as the Bull and Bear levered SHNY (Direxion Daily Silver Miners Index Bull 2X Shares, Expense Ratio 1.00%) and DULL (Direxion Daily Silver Miners Index Bear 2X Shares, Expense Ratio 1.00%).

As one might expect, the volatility in this space lately has attracted the usual spates of interest in the leveraged Bull and Bear Gold Miner funds as well, such as NUGT (Direxion Daily Gold Miners Index Bull 3X Shares, Expense Ratio 1.15%), JNUG (Direxion Daily Junior Gold Miners Index Bull 3X, Expense Ratio 1.25%), DUST (Direxion Daily Gold Miners Index Bear 3X, Expense Ratio 1.12%), and JDST (Direxion Daily Junior Gold Miners Index Bear 3X, Expense Ratio 1.13%).

GDX-2017-05-04

The VanEck Vectors Gold Miners ETF (NYSE:GDX) was trading at $21.06 per share on Thursday morning, down $0.45 (-2.09%). Year-to-date, GDX has gained 0.67%, versus a 6.75% rise in the benchmark S&P 500 index during the same period.

GDX currently has an ETF Daily News SMART Grade of C (Neutral), and is ranked #13 of 33 ETFs in the Precious Metals ETFs category.


Disclaimer: The content of this article is excerpted from a daily newsletter from Street One Financial. While ETF Daily News may edit the contents and add a relevant title to the piece, the author, Paul Weisbruch, does not endorse or recommend any issuer or security mentioned herein.

About the Author: Paul Weisbruch

paul-weisbruchPaul Weisbruch is the VP of ETF/Options Sales and Trading at Street One Financial. Prior to joining the team at Street One, Paul served as the Director of RIA and Institutional ETF Sales at RevenueShares ETFs from December 2007 until November of 2009. Before RevenueShares, Paul was employed by Susquehanna International Group from 2000 until 2007 serving in roles including OTC/NYSE Institutional Block Trading, Nasdaq/OTC Market Making, ETF/Derivatives Intelligence and Strategy, Algorithmic Trading, as well as acting as the PHLX Floor Specialist in the ETFs, SPY and DIA.Paul has been actively involved in the ETF space from both a product and trading standpoint since 2000. Additionally, Paul has well forged relationships with national RIAs, institutional pension fund managers and consultants, mutual fund and hedge fund managers, and also the ETF media. Co-authoring the “S1F ETF Daily” since 2009, the daily piece has become a must for many portfolio managers in the ETF space, with segments regularly appearing in the likes of Barron’s, WSJ, and ETFTrends.com for instance.

He holds his Series 4 (Registered Options Principal), 6, 7, 55 (Equity Trader), 63, and 65 licenses. He graduated from the University of Pittsburgh (B.S. – Economics), graduating magna cum laude, and has an MBA from Villanova University.