The bear market in gold stocks continues with many of the more notable names hitting 52 week lows during the past few days. Barrick the world’s largest gold producer, (NYSE:ABX)(TO:ABX), hit a low of $14.80, down from $55 just three years ago. Gold equities have been extremely volatile in the past year, creating fantastic trading opportunities.
Gold is down ~8.5% in the last year but is actually up ~2.5% year to date.
The TSX Gold index is getting close to yearly lows. Last year, tax loss selling was seen by many as contributing to a bottom in the sector. We would probably already be at those levels now except for strong year to date performances from royalty companies Franco-Nevada Corporation (NYSE:FNV)(TO:FNV) and Royal Gold (NASDAQ:RGLD)(TO:RGL).
Names hitting 52 week lows recently include Kinross (NYSE:KGC)(TO:K), New Gold (AMEX:NGD)(TO:NGD), Allied Nevada (AMEX:ANV)(TO:ANV), Argonaut (OTC:ARNGF)(TO:AR), McEwen Mining (NYSE:MUX)(TO:MUX), Primero Mining (NYSE:PPP)(TO:P), and Yamana Gold (NYSE:AUY)(TO:YRI).
Tax loss selling this year could be brutal again so I am keeping some powder ready. However, the sector can also turn around quickly, as evidenced last year with many companies up 30-50% in the first quarter.
I am excited for the next couple months and look forward to buying the top gold names at rock bottom prices.