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Gold Stocks: The Higher They Climb...

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On Monday, 38 selected Toronto-listed gold stock juniors were trading at an average of 28% off 12-month highs.

The big North American and Australian names that have led upward the global gold stocks sector since August 19 this year were pounded on Monday, following a correction in gold bullion. Looking across the board, gold stocks were awash in screens of red.

Since the recovery of stocks in general starting just after mid-August, and a resurgent gold bullion price, Tier I gold stock North American names Kinross, Barrick, and Goldcorp, have reached fresh records, along with Tier I Australian names Lihir and Newcrest. The Tier I South African names - AngloGold Ashanti, Gold Fields and Harmony - lagged, along with North American name, Newmont...

Gold stock investment trends over the past few months have clearly shown that investors have only really been prepared to commit to the bigger, quality names. This analysis has come through in the strong outperformance by Tier I and Tier II stocks, relative to the indifferent showing from Tier III stocks, and the lacklustre showing by developers and explorers, where dozens of hopeful names are listed. On Monday, 38 selected Toronto-listed gold stock juniors were trading at an average of 28% off 12-month highs.

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