GDXJ was debut this Wednesday. Both GDX and GDXJ (the junior companies) are offered by Van Eck.
Here are the links to the company site for GDX and GDXJ. The complete weighting of the components are listed below:
| Fund Holdings of GDX as of 2009/11/12
|
|||||
| Number
|
Holding
|
Ticker
|
Shares
|
Market Value
|
% of net assets
|
|
1
|
Barrick Gold Corp
|
ABX
|
18,718,639
|
$783,749,414.93
|
14.49%
|
|
2
|
Goldcorp Inc
|
GG
|
14,249,524
|
$614,011,989.16
|
11.36%
|
|
3
|
Newmont Mining Corp
|
NEM
|
9,475,288
|
$470,353,296.32
|
8.70%
|
|
4
|
AngloGold Ashanti Ltd
|
AU
|
6,999,199
|
$304,045,204.56
|
5.62%
|
|
5
|
Lihir Gold Ltd
|
LIHR
|
8,569,682
|
$265,317,354.72
|
4.93%
|
|
6
|
Cia de Minas Buenaventura SA
|
BVN
|
7,114,374
|
$263,587,556.70
|
4.87%
|
|
7
|
Yamana Gold Inc
|
AUY
|
21,130,631
|
$259,484,148.68
|
4.80%
|
|
8
|
Randgold Resources Ltd
|
GOLD US
|
3,203,698
|
$255,110,471.74
|
4.72%
|
|
9
|
Kinross Gold Corp
|
KGC
|
13,436,964
|
$252,883,662.48
|
4.68%
|
|
10
|
IAMGOLD Corp
|
IAG
|
14,744,197
|
$251,536,000.82
|
4.65%
|
|
11
|
Gold Fields Ltd
|
GFI
|
16,291,819
|
$229,714,647.90
|
4.25%
|
|
12
|
Agnico-Eagle Mines Ltd
|
AEM US
|
3,748,931
|
$223,736,202.08
|
4.14%
|
|
13
|
Eldorado Gold Corp
|
EGO
|
16,025,187
|
$207,205,667.91
|
3.83%
|
|
14
|
Silver Wheaton Corp
|
SLW
|
13,420,202
|
$199,692,605.76
|
3.69%
|
|
15
|
Harmony Gold Mining Co Ltd
|
HMY
|
17,100,638
|
$175,452,545.88
|
3.24%
|
|
16
|
PAN American Silver Corp
|
PAAS
|
3,501,327
|
$82,036,091.61
|
1.52%
|
|
17
|
Royal Gold Inc
|
RGLD
|
1,636,283
|
$81,715,973.02
|
1.51%
|
|
18
|
Coeur d’Alene Mines Corp.
|
CDE US
|
3,026,689
|
$63,378,867.66
|
1.17%
|
|
19
|
New Gold Inc
|
NGD
|
15,532,015
|
$59,176,977.15
|
1.09%
|
|
20
|
Silver Standard Resources Inc
|
SSRI US
|
2,878,399
|
$56,071,212.52
|
1.04%
|
|
21
|
Hecla Mining Co
|
HL US
|
9,493,058
|
$50,692,929.72
|
0.94%
|
|
22
|
Gammon Gold Inc
|
GRS US
|
4,993,219
|
$49,233,139.34
|
0.91%
|
|
23
|
Seabridge Gold Inc
|
SA
|
1,505,674
|
$35,142,431.16
|
0.65%
|
|
24
|
Golden Star Resources Ltd
|
GSS US
|
9,492,472
|
$32,369,329.52
|
0.60%
|
|
25
|
Aurizon Mines Ltd
|
AZK
|
6,375,413
|
$30,219,457.62
|
0.56%
|
|
26
|
Northgate Minerals Corp
|
NXG US
|
10,274,632
|
$30,207,418.08
|
0.56%
|
|
27
|
Minefinders Corp
|
MFN US
|
2,376,917
|
$23,674,093.32
|
0.44%
|
|
28
|
Great Basin Gold Ltd
|
GBG
|
13,386,929
|
$20,883,609.24
|
0.39%
|
|
29
|
Nevsun Resources Ltd
|
NSU
|
5,149,665
|
$14,882,531.85
|
0.28%
|
|
30
|
Tanzanian Royalty Exploration Corp
|
TRE
|
3,603,954
|
$12,469,680.84
|
0.23%
|
|
31
|
Cash
|
6,655,296
|
$6,655,380.14
|
0.12%
|
|
|
32
|
Vista Gold Corp
|
VGZ CN
|
1,705,026
|
$4,569,469.68
|
0.08%
|
| Fund Holdings of GDXJ as of 2009/11/12
|
|||||
| Number
|
Holding
|
Ticker
|
Shares
|
Market Value
|
% of net assets
|
|
1
|
Coeur d’Alene Mines Corp.
|
CDE US
|
56,910
|
$1,191,695.40
|
6.42%
|
|
2
|
Silver Standard Resources Inc
|
SSRI US
|
51,510
|
$1,003,414.80
|
5.40%
|
|
3
|
New Gold Inc
|
NGD CN
|
251,160
|
$972,587.72
|
5.24%
|
|
4
|
Hecla Mining Co
|
HL US
|
177,285
|
$946,701.90
|
5.10%
|
|
5
|
Gammon Gold Inc
|
GRS US
|
89,085
|
$878,378.10
|
4.73%
|
|
6
|
Alamos Gold Inc
|
AGI CN
|
80,610
|
$808,060.57
|
4.35%
|
|
7
|
Silvercorp Metals Inc
|
SVM CN
|
117,615
|
$712,342.27
|
3.84%
|
|
8
|
Semafo Inc
|
SMF CN
|
187,800
|
$707,530.16
|
3.81%
|
|
9
|
European Goldfields Ltd
|
EGU CN
|
95,100
|
$648,543.09
|
3.49%
|
|
10
|
Golden Star Resources Ltd
|
GSS US
|
175,590
|
$598,761.90
|
3.22%
|
|
11
|
Northgate Minerals Corp
|
NXG US
|
192,960
|
$567,302.40
|
3.06%
|
|
12
|
Kingsgate Consolidated Ltd
|
KCN AU
|
65,010
|
$548,420.73
|
2.95%
|
|
13
|
Jaguar Mining Inc
|
JAG CN
|
52,200
|
$545,176.21
|
2.94%
|
|
14
|
San Gold Corp
|
SGR CN
|
185,925
|
$530,226.29
|
2.86%
|
|
15
|
Aurizon Mines Ltd
|
ARZ CN
|
112,455
|
$528,783.59
|
2.85%
|
|
16
|
Novagold Resources Inc
|
NG US
|
97,935
|
$509,262.00
|
2.74%
|
|
17
|
Andean Resources Ltd
|
AND CN
|
229,485
|
$503,424.58
|
2.71%
|
|
18
|
Gabriel Resources Ltd
|
GBU CN
|
147,360
|
$444,139.06
|
2.39%
|
|
19
|
Minefinders Corp
|
MFN US
|
43,560
|
$433,857.60
|
2.34%
|
|
20
|
Allied Nevada Gold Corp
|
ANV US
|
38,055
|
$428,499.30
|
2.31%
|
|
21
|
Ventana Gold Corp
|
VEN CN
|
38,040
|
$420,147.07
|
2.26%
|
|
22
|
Rubicon Minerals Corp
|
RMX CN
|
99,240
|
$411,744.96
|
2.22%
|
|
23
|
Great Basin Gold Ltd
|
GBG CN
|
251,820
|
$393,900.33
|
2.12%
|
|
24
|
Lake Shore Gold Corp
|
LSG CN
|
92,505
|
$355,567.89
|
1.91%
|
|
25
|
St Barbara Ltd
|
SBM AU
|
1,032,395
|
$343,436.08
|
1.85%
|
|
26
|
Kirkland Lake Gold Inc
|
KGI CN
|
38,685
|
$332,075.92
|
1.79%
|
|
27
|
Avoca Resources Ltd
|
AVO AU
|
194,325
|
$333,011.01
|
1.79%
|
|
28
|
Fronteer Development Group Inc
|
FRG US
|
79,110
|
$328,306.50
|
1.77%
|
|
29
|
Romarco Minerals Inc
|
R CN
|
245,175
|
$327,383.28
|
1.76%
|
|
30
|
Medusa Mining Ltd
|
MML AU
|
77,745
|
$284,326.89
|
1.53%
|
|
31
|
Detour Gold Corp
|
DGC CN
|
20,685
|
$271,275.45
|
1.46%
|
|
32
|
Gold Wheaton Gold Corp
|
GLW CN
|
759,960
|
$217,452.43
|
1.17%
|
|
33
|
Dominion Mining Ltd
|
DOM AU
|
55,260
|
$202,474.00
|
1.09%
|
|
34
|
Real Gold Mining Ltd
|
246 HK
|
127,500
|
$194,484.35
|
1.05%
|
|
35
|
Colossus Minerals Inc
|
CSI CN
|
37,230
|
$187,135.39
|
1.01%
|
|
36
|
U S Gold Corp
|
UXG US
|
61,875
|
$167,681.25
|
0.90%
|
|
37
|
Avocet Mining Plc
|
AVM LN
|
97,665
|
$156,218.24
|
0.84%
|
|
38
|
Lingbao Gold Co Ltd-H
|
3330 HK
|
210,000
|
$81,009.51
|
0.44%
|
GDX is a tracking ETF to GDM index, a mining index determined by Nyse. The component weighting cannot be determined by Van Eck. Unfortunately, the top holding ABX at 14.5% is probably one of the worst choice. ABX recently announced to dehedge its gold forward sale, which was costing ABX some 4 billion dollars. ABX is also rumored to be the accomplice of gold suppression scheme together with JPM & Fed. The other components in GDX that I don’t like are AU at 5.62%, GFI at 4.25%, HMY at 3.24%, all are deriving 100% or significant gold productions in Africa. As the gold prices zoom upward, mining gold in an impoverished (relatively speaking) continent will tend to be problematic. I expect more labor and theft and political problems. Also gold production from Africa is declining as a whole. With the exception of GFI, which has expanded its production to other continents, the other two companies are definitely not my preferred choice (especially HMY). GFI is probably the “cheapest” company among major gold producers that one can buy, since its mine life is still quite long. HMY may have the highest leverage to gold price, due to its very high cost basis. At later stages of gold bull market, HMY could easily come back with a vengeance despite the terrible management. Although one may consider shorting out those components when owning GDX, I hesitate to do that. The other company that derive its production from Africa is RangGold (GOLD) at 4.72%. This has been one of the company that has baffled me, easily outperforming all other components, without me owning it. Definitely one should not short this component out.
Onto the new GDXJ, top components (CDE, SSRI, HL, SVM) are taken by all silver mining companies instead of gold mining companies. That’s 21% of the GDXJ. My ongoing concern about investing in silver companies is that they will couple to the general stock market a lot more than gold mining companies (at least initially). In a deflation, gold/silver ratio will zoom upward, relatively depressing the price of silver. I would have hoped to have less silver components. By the way, junior companies or small-cap stocks also tend to get depressed more in a downwave. Regardless, CDE and HL (and MFN) don’t seem to have good management in shareholders’ interests, raising big amount of capital at the recent zenith of 2008/2009, diluting a big percentage of their stockholders. I suspect that the deals were hammered out with hedge funds in the Wallstreet who have shorted all these companies in the backroom. With a big short ratio, it was simply not possible to cover those short position via open market purchases without driving up the stock prices. And what is the chance of having so many companies silmultaneously raising capital all the the absolute zenith of the stock market?
Most of the rest of the GDXJ components beyond top ten are not familiar to me. And that is the beauty of investing in an ETF, not needing to know every individual company. Assuming that gold bull market continues, GDXJ will eventually outperform GDX, with much higher volatility. I expect the rallies in both will be kind of in stages, with GDX the big cap leading the way.
Both gold & mining companies are short-term overbought, and had a tremendous recovery since 2008 crash. Based on Elliot wave reading, I’m fairly certain that we are looking at major wave 3. It is hard to tell whether wave 2 of 3 has happened or not. Regardless, if you have the nerves to buy and the stomach to ride out the tremendous volatility (20% to 50% up and down probably for more than 4 times per year), I think the reward may be good.
Granted, I’m still holding back due to my expectation of a significant general stock market correction in Q1/Q2 next year. But no one can predict the stock market with certainty. The best thing to do is to pick and weigh each of your portfolio position carefully, and stand firmly to ride out the combined volatility.
Frugal at 1stMillionAt33.com
