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« The Other Side of the Coin: Strong Dollar | Main | Kinross Gold Corp Leads Gold Sector Rebound »

Barrick Gold Corp Shows Heavyweight Gold Stocks Can Move

One of the main arguments for holding smaller, junior gold shares is that they offer more leverage to rising prices, and you get more “bang of your buck”. However as the chart below shows, this is not always the case.

ABX Shows Heavyweight Gold Stocks Can Move

Barrick Gold Corp has a market cap of $26.5bln and is the biggest gold mining company in the world. Therefore it fits the profile of a heavyweight gold producer who, according to the thesis of those that invest in junior companies, should move more sluggishly.

However, a quick glance at the above chart tells you all you need to know. ABX has almost doubled in two months, which shows that even the larger gold companies can have nimble stock prices.

Another insight into this move up in ABX is that it shows a renewed interest in the gold mining sector. A junior gold mine can double and halve on a few thousand dollars, but the buying power needed to double the stock price of a $26.5 billion company is much more significant, and therefore this move up in Barrick should be viewed as a very positive sign for gold sector.

We may have seen the bottom and be looking at a substantial rally over the coming months.. Stay tuned to The Gold Prices Newsletter for updates and trading signals as there looks to be exciting times ahead.

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Reader Comments (4)

Its unbelievable how strong ABX' the rally is, especially considering gold is grinding easily when days are passing by.
The confidence of goldstocks is shown here by the early bulls. They already made 100 percent here at these price levels.

I'm more into the juniors. And the highest gain so far; 76 percent with Hecla.

I'm gonna unleash a turbo on gold for now. There are resistances being crossed at we speak.

Barrick leads the way!

December 11, 2008 | Unregistered Commenterde Graaf

Percentages never meant very much to me. A price rising from a nickel to a dime is 100%, but it is still only a five cent increase. A profit or increase in terms of actual money, always seems to have much more significance, at least to me.

But, then again, to each his own.


December 11, 2008 | Unregistered CommenterJohn Ell

John, considering the charts given, a shareprice from 17 to 30+ is scraping the 100 percent level, roughly speaking.

See above charts.

December 11, 2008 | Unregistered Commenterde Graaf

I understand, de Graaf, but it remains that I just simply like the ring of the currency rather than the percentages.

Also, with respect to the editorial by Gold Prices, I believe that what we are witnessing is the serious interest on the part of investors, traders, speculators, for the quality stocks and investments. That's OK with me, especially when I see AEM jumping ahead $2/$3.

December 12, 2008 | Unregistered CommenterJohn Ell

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