For those who, like myself, believe the rally we've seen of late in the price of gold will continue for the foreseeable future, getting maximum leverage ought to be the goal. (Being reasonable is key here; I’m certainly not talking about any leveraged ETF products).
In this article, I'm going to discuss my top pick for such investors seeking such leverage in the Exchange Traded Fund (ETF) world.
The VanEck Vectors Junior Gold Miner ETF (TSX:GDXJ) is a broadly-diversified ETF holding a range of junior gold mining companies. These junior gold miners are those with exploration potential and or small production capacity, seeking investment to drill for additional reserves and/or turn existing potential gold mines into fully operating gold mines.
As can be expected, these companies generally have highly speculative business models. Investors generally need to invest in many such companies to diversify away the high levels of mine- specific risks present in these companies.
This ETF does the diversification part for investors and allows those looking to profit from rising gold prices to do so by creating a basket of junior miners to choose from. Please have the highest risk-reward fundamentals, so make sure it fits your risk profile; That said, if you're bullish on gold, being aggressive with an ETF like this is a great way to go.
Invest wisely, my friends.
