"But we expect that, by the end of the year, gold and silver and platinum and palladium will all be higher than they are now, and that gold equities also will be a lot stronger," he added.In a broad sense, mining stocks are generally correlated to the price of the precious metals themselves, but they react more dramatically to fluctuations in price, both on the upside and on the downside. That explains why these ETFs have dropped far more dramatically than gold and silver spot prices did in 2013."Miners tend to be a high-beta play on the price of the metal itself," Andrew Chanin, CEO of PureFunds, told IndexUniverse. "When gold or silver goes up, miners go up more on a percentage basis."
"We've seen some overselling, and some miners are trading at ridiculous discounts," Chanin said. "Now, we're beginning to see M&A come back into the space.""M&A tends to come in when the cycle is turning," he added. "They typically like to buy their mines at discounts, and we're seeing that activity coming back now. We're hoping this is a turning point for metals."
"You don't want to put all your money into gold and silver," CPM's Christian said. "But if you look at it, the stock market is very high and very top-heavy; the bond market is suicidal to be long; and gold and silver, they've paid their dues.""The prices are way off from their 2011 peaks," he added. "They probably represent good long-term buys for a portion of your portfolio."