Gold-Miner ETF Surges Over 30% in One Month, Outperforming Bullion Funds

An exchange-traded fund (ETF) that invests in global gold miners has surged more than 30% over the past month, drawing investor attention. The rally reflects expectations that structurally higher gold prices will sharply improve miners' margins.

The HANARO Global Gold Mining Companies ETF posted a one-month return of 30.78%, making it the highest among locally listed ETFs in South Korea. This fund invests in shares of global gold-mining companies, with Newmont Corp. being its largest holding at 12.53%.

Newmont, one of the world's biggest gold miners, has seen its shares rise 38% in the month through Aug. 20, outperforming the S&P 500 which gained 1.76%. The fund's other holdings with weights above 5% also climbed sharply, including Agnico Eagle Mines at 49.72%, Barrick Mining at 27.22%, Wheaton Precious Metals at 36.64%, and AngloGold Ashanti at 46.68%.

Brokerages say the uptrend in gold prices could continue if uncertainty over fiscal soundness and eroding confidence in the dollar persist. Analyst Ko Kyung-bum at Yuanta Securities Korea notes that gold prices have continued to climb even after the 30-year US Treasury yield recently rose above 5.3%, driven by a widening term premium tied to uncertainty over fiscal soundness.