Do Gold Miners Beat Bullion? What the Data Really Says

Testing the Performance of Miners vs. Bullion

Hi there. In this week’s Research Insights, I discuss recent research challenging the common belief that gold mining stocks provide a leveraged way to gain exposure to gold. The logic seems intuitive: If gold prices rise, miners should enjoy expanding profit margins and magnified returns. However, recent research suggests that, over the long run, this assumption does not hold. Gold miners have underperformed physical gold by a significant margin.

Below, I review recent research and present empirical results comparing the performance of bullion to mining stocks.