Frank Holmes – Why junior gold stocks could be gearing up for a glittering performance

By Frank Holmes

Investor appetite for junior gold miners—those that produce less than 1 million ounces a year, if at all—has also been muted, despite small-cap explorers and producers having greater operating leverage and earnings upside to rising gold prices. In the chart below, you can see that the MVIS Junior Gold Miners Index outperformed the seniors—sometimes greatly—when gold prices were ripping, though juniors also had lower lows when the yellow metal was under pressure.