The spot price of gold has moved up marginally in the past week as of close on April 25, but overall it has been a tough month for the yellow metal.
Gold gained momentum in late 2018 and held strong in 2019 in the face of a huge rally for equities in most global markets. The policy U-turn from central banks, combined with dimming economic prospects, has been bullish for gold.
These factors should keep confidence in gold as we head into the middle of spring. Markets have performed very well to start 2019, but slow growth will spillover to impact the market in the near term. Now could be a solid opportunity to add gold equities at a discount.
The BMO Junior Gold ETF (TSX:ZJG) aims to replicate the performance of a junior gold companies index. Investors hedging with gold may as well aim high, and this ETF provides a chance to own some potentially explosive equities that would see big gains in the event of a large uptick.
The ETF has dropped 1.31% in 2019 as of close on April 25 and suffered an 18.6% drop in 2018.
Some of the top holdings in this fund include OceanaGold Corporation, (TSX:OGC) an Australia-based mid-tier gold company, IAMGOLD Corporation (TSX:IMG), and Alamos Gold Inc (TSX:AGI). Roughly 70% of the fund’s portfolio allocation is in Canada-based assets. Shares are trading at the middle of its 52-week range. Investors looking for high-risk high-reward gold exposure should consider this ETF right now.
