This post is part of a special annual report -- Top Stock Picks '09 -- in which TheStockAdvisors.com asked 75 leading newsletter advisors to select their favorite investment for the new year.
Pamela Aden, in her industry-leading The Aden Forecast expects a rebound for gold-mining stocks. What's her favorite way to play this sector? Market Vectors Gold Miners ETF (NYSE: GDX).
"Most markets fell sharply in 2008 as the financial crisis intensified. Gold shares were especially hard hit as gold and the stock market both declined, increasing the downward pressure on these stocks.
"Currently, all of these markets are bombed out and extremely oversold. This means that stocks and gold are poised to move higher, and gold stocks will indeed benefit on both counts.
"Demand for physical gold has been incredibly strong in the last quarter as prices fell during the credit crisis squeeze. You'll remember that gold, like most assets, was sold during the deleveraging when selling was rampant.
"At the same time, buyers came in from around the world as a heavy run on gold caused a supply shortage. The World Gold Council said the demand for gold reached a record in the Q3 as the race to secure physical gold reached an intensity never seen before.
"A good way to invest in this sector is by buying the Market Vectors Gold Miners, an exchange-traded fund. It corresponds to a variety of publicly traded gold and silver mining companies and it's a good representative of the gold stock market in general."
Steven Halpern's TheStockAdvisors.com offers a daily look at the latest market commentary and favorite stock picks and investment ideas from the nation's leading financial newsletter advisors.
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Reader Comments (Page 1 of 1)
1-06-2009 @ 2:24PM
Kerri said...
Do you notice how many more of the gold buying commercials cropped up over the last Q? I say prepare for the worst, and hope for the best. Do what I did, and learn to trade the forex. If you don't know how, you can get a $100,000 free demo account by going to http://forex-currencyexchange.com click the link at the top left corner, if I remember correctly. It will take you to a sign up page where all you have to do is give your name and email. You can then start practicing trading. Trading with virtual money is so much fun... and addicting. The only problem is, more often than not, you will be wishing you were trading with real money. You never know, this may be something that you have a knack for, then go ahead and try your hand at it with the real stuff. I believe trading currencies is much better than gambling with the stock market these days that's for sure.