In addition to investing in physical gold, there are other ways for investors to invest in gold. In addition to listed securities such as ETCs and certificates, this primarily includes shares of gold mine operators.
In the following, we will take a closer look at the most important facts about gold mining shares.
Advantages and disadvantages of mining shares
Mining shares are an indirect way to participate in the development of the gold price. The prices of gold mining shares show a tendency to parallel the gold price.
However, the share price is also influenced by classic company-specific factors, such as the efficiency of gold production, the yield of the mines, the financing situation of the mining companies or the company management.
Unlike investors who invest directly in gold, investors in mining shares do not acquire any rights to the commodity gold, nor do they participate one-to-one in the development of the gold price. In return, they have the chance to receive dividend payments.
In addition, mining stocks have high tradability and offer the opportunity for leverage when the price of gold rises.
Where mining shares are traded
The shares of the mine operators are usually listed on the stock exchanges of the respective home countries. However, they often also have a secondary listing on the London Stock Exchange, or even on the Frankfurt Stock Exchange.
The NYSE Arca Gold BUGS Index (HUI), the DAXglobal Gold Miners, the Philadelphia Gold & Silver Index (XAU) or the UBS Solactive Global Pure Gold Miners, for example, can be used as a reference index. They track the performance of gold producers and gold-producing mining companies.
Countries with the largest gold deposits
In Europe, you will search in vain for gold mines. The largest economically mineable gold deposits are in Australia. Russia and South Africa rank second and third – but by a wide margin. While in Australia about 10000 tons of gold deposits are estimated, in Russia there are only 5300 and in South Africa about 3200 tons of gold.
After the three largest mining countries, the USA, Indonesia, Brazil, Peru, China, Canada and Uzbekistan also play a significant role in gold mining.
However, if we look at the production volumes of the individual mines, the picture is completely different. Currently, the Grasberg mine in Indonesia is considered to be the mine with the highest production volume in the world. In second place is the Barrick Nevada 1 mine in the USA, followed by the Muruntau 2 mine in Uzbekistan.
The largest mining companies
The undisputed market leader is currently the Canadian company Barrick Gold, followed by the US mining company Newmont Mining. Also among the largest mining companies are Anglo Gold Ashanti of South Africa, Kinross Gold, Newcrest Mining, and Gold Fields.
