Market Vectors Gold Miners (GDX ETF) represents an exchange-traded fund which was established in 2006. The fund is passively managed and sponsored by Van Eck Global. As of 2007, the assets of the fund totaled $625 million. GDX ETF is listed under the ticker GDX at the New York Stock Exchange.
GDX ETF tracks the Amex Gold Miners Index and offers exposure to the fluctuations of the gold market. Amex represents a capitalization index in which the market value of stocks exerts proportional influence over the index. The weighting is applied to avoid domination by some of the larger companies and to account for the contribution of the smaller companies. Amex consists of publicly traded companies engaged in the mining industry. The market capitalization of the selected companies exceeds $ 100 million. In accordance, the index includes gold mining companies such as Barrick Gold, AngloGold Ashanti, Agnico-Eagle Mines, Compania de Minas Buenaventura, and Northern Orion Express, among others. Comprised of 44 constituents at present, Amex is the largest index oriented toward the gold mining sector. Finally, the index is computed and maintained by the American Stock Exchange.
Market Vectors Gold Miners aims to reproduce the performance of the companies included in the Amex index. The trust invests in American depository receipts and common shares of companies covered by the index. The fund is open to institutional and individual investors.
The shares are issued and consequently redeemed at their net asset value only by authorized brokerages. They may be traded at a premium to their net asset value in the secondary market. Furthermore, the fund is subject to the risks involved in investment in the gold mining industry. It is largely known that the price of gold tends to fluctuate. Moreover, political turmoil and economic downturns may cause drops in the value of gold. In addition, the fund may be unable to reproduce the performance of Amex. The index provides guidance which does not guarantee in full the success of individual investments.