The dominant gold-stock ETF finally bested its last record close, which was seen an astonishing 14 years ago! stocks forging back into record territory will fuel much bullish financial-media coverage and trader interest, leading to more buying. And this record breakout still remains earlier in gold stocks’ revaluation way higher, as miners’ fundamentals are radically better today than they were 14 years ago.
Seemingly an eternity ago in early September 2011, the GDX gold-stock ETF surged to an all-time-record high of $66.63 capping a magnificent 307.0% secular bull over 2.9 years! Gold stocks quadrupling earned fortunes for contrarians, then like after all bull markets a bear one followed. It was normal until April 2013, when a gold panic erupted as key multi-year support at $1,550 failed spawning brutal cascading selling.
When the dust finally settled in mid-January 2016, GDX had collapsed a catastrophic 81.3% across 4.4 years to its all-time low of $12.47! That anomalous disaster left gold stocks one of the most-hated sectors in all the markets. Gold stocks did start marching higher out of that, with GDX achieving nice 151.2% and 153.2% bull runs into early August 2016 and early August 2020. But gold stocks still remained largely ignored.
Part of the reason was their prices languished way under record levels despite gold achieving many new record closes of its own starting in early December 2023. Historically the major gold stocks of GDX tended to amplify material gold moves by 2x to 3x. Gold stocks need to outperform their metal in order to compensate traders for their big additional operational, geological, and geopolitical risks on top of gold price trends.
While gold miners’ profits soared reflecting gold’s mighty bull run born in early October 2023, their stock prices didn’t. In 2024, gold blasted 27.2% higher yet GDX dreadfully lagged merely rallying 9.4%! Gold stocks looked hopelessly broken, so out of favor that investors would never return. But stock prices always eventually reflect underlying fundamentals, so that gold-stock undervaluation anomaly couldn’t last long.
My first essay this year written as January dawned was called “Gold Stocks’ Revaluation Year”. In it I concluded, “The bottom line is 2025 has great potential for gold stocks to enjoy a major-paradigm-shift revaluation higher. Gold just experienced one last year, which gold stocks greatly lagged. … That makes gold miners’ fat-and-rich profits durable, leaving their stocks deeply undervalued.” That deviation had to be resolved.
I continued “Fund managers will increasingly notice that, and start upping their tiny allocations. The resulting gold-stock gains will turn psychology bullish again, fueling increasing buying normalizing prices.” Boy that has proven true in spades. Year-to-date as of midweek, GDX has skyrocketed up 102.0% to gold’s huge parallel 38.7% gain! That makes for normal 2.6x leverage as gold stocks revalue way higher.
But since gold stocks aren’t a widely-followed sector, they really needed bullish financial-media coverage to build trader interest. That was been mounting all year with GDX’s massive gains, but new record highs would supercharge it. Records have always fascinated both market commentators and traders. Just this Monday, GDX’s $67.24 close was its first record achieved in fully 14.0 years since early September 2011!
But at just 0.9% higher, that wasn’t yet decisive. Breakouts need to extend 1%+ beyond previous highs to become decisive, lowering the odds of multiple tops. GDX smashed that decisive-breakout threshold surging 2.5% to $68.50 this Wednesday. That was 2.8% better than early September 2011’s old record, leaving no doubt. The gold stocks have finally bested their old record that stood for a staggering 14 years!
Think of how long that is. Assuming an average investor starts around 25 years old and retires around 65, that’s a 40-year investing lifespan. GDX’s extreme record-less span consumed fully 35% of that! Try to remember what your life was like 14 years ago, how old your kids were and what your family’s major activities were way back then. My wife and I had our firstborn earlier in 2011, which sure feels forever ago.
This secular chart encompasses nearly the entire history of GDX, which was launched in mid-May 2006. The vast gulf between its last record closes and this week’s is glaringly apparent. GDX forging back into record territory changes everything, dramatically shifting gold-stock psychology. The financial media loves bullishly covering new records and traders love chasing sectors achieving them, fueling big capital inflows.
With this super-long-term chart, GDX’s massive revaluation higher this year looks uncomfortably vertical and parabolic. But compressing many years into secular charts always creates the effect of recent action looking extreme. In my essay last week on gold-stock records nigh, I included a several-year GDX chart only going back to 2023. While still spectacular, GDX’s gains this year look way-less-vertical at that scale.
While GDX has soared into extreme-overbought territory, that was only very recently. During the last five years, that started at 35% above GDX’s trailing 200-day-moving-average baseline. GDX first hit those levels just two weeks ago on August 26th. Then that metric stretched to 1.462x GDX’s key 200dma at this Wednesday’s decisive-breakout record close. So gold stocks certainly are extremely overbought today.
That argues a sharp selloff is increasingly probable to rebalance overextended technicals and sentiment. During powerful bull runs, 50dmas often prove major support for these selloffs. GDX has bounced near its 50dma seven times in 2025 alone, and today that is down at $56.89 though climbing rapidly. So a gold-stock selloff here wouldn’t be surprising, offering a good opportunity for traders to deploy more capital.
But short-term technicals aside, gold miners’ fundamentals still support much-higher stock prices ahead. Just over a month ago, I wrote an essay analyzing GDX’s record-high watch when it was still way down at $57.39. In it I tried to estimate how much major gold miners were earning back in Q3’11 which was that last time GDX hit records. That was challenging, as key data for gold-stock valuations common today didn’t exist.
The best proxy for how gold miners are faring as a sector is implied unit earnings. They simply subtract the top-25 GDX gold miners’ average all-in sustaining costs each quarter from its quarterly-average gold prices. This metric is much cleaner than bottom-line accounting profits, which are often distorted by big unusual non-cash items like mine writedowns. But AISCs weren’t even introduced until way later in June 2013.
For the last 37 quarters in a row now, I’ve been analyzing gold miners’ latest quarterly results in essays right after earnings seasons. But that deep-research thread still only extends back to Q2’16, way after GDX’s last record highs. And after all the mergers in gold-stock land since, getting data from Q3’11 is difficult if not impossible. But gold miners did report cash costs back then, the biggest component of AISCs.
A month ago I resorted to admittedly-hallucination-prone LLM AI which claimed major gold miners’ average cash costs in Q3’11 were $694 per ounce. That seemed high, as starting with my research in Q2’16 GDX-top-25 cash costs averaged $611 for the first dozen quarters. But that $694 is still the best estimate we have for Q3’11. And over the last 37 quarters ending Q2’25, AISCs have averaged 1.38x cash costs.
That implies GDX-top-25 AISCs around $959 at its last record closes, in a quarter where gold averaged $1,706. That makes for implied unit profits around $747 per ounce. That had to have been a big record at that time, but has since been dwarfed. In these last four reported quarters ending in Q2’25, the GDX-top-25 gold miners have reported implied unit profits of $1,046, $1,207, $1,470, and $1,861 which are far higher!
Average those, and gold miners’ earnings are running about 1.9x higher over this past year than in Q3’11. That argues gold-stock price levels should be about double that last peak’s. And gold miners’ implied unit profits are trending higher still to more epic records. As of midweek, this current Q3 is nearly 4/5ths over and gold is averaging another phenomenal record $3,387 quarter-to-date! That will almost certainly hold.
Trading way up at $3,640 midweek, gold can’t drag that Q3 average lower unless gold plunges well under it in the next several weeks. That average is 7.0% under current prices. And the GDX top 25’s latest full-year-2025 AISC guidance is averaging $1,537. That’s conservative for a Q3 estimate, as many gold miners have forecast lower mining costs in Q3 and Q4 on improving production compared to Q1 and Q2.
Still these numbers argue the GDX top 25’s Q3’25 implied unit profits will shake out near or better than $1,850 per ounce! That would make for 77% year-over-year growth, remaining up near Q2’25’s record $1,861. These latest two quarters likely averaging near $1,856 is a whopping 2.5x higher than Q3’11’s estimates at GDX’s last records! That again argues that gold-stock prices ought to at least double again from here.
As always it won’t be a one-way ride, this volatile sector will surge then sell off as it choppily normalizes with these lofty prevailing gold prices. But gold miners’ spectacular fundamentals are attracting in more and more investors, particularly fund managers. During the last eight reported quarters ending in Q2’25, GDX-top-25 implied unit earnings skyrocketed 87%, 47%, 31%, 75%, 74%, 78%, 90%, and 78% YoY!
There are also technical arguments for much-higher gold-stock prices coming. Again GDX’s major gold stocks tend to amplify material gold moves by 2x to 3x, reflecting their underlying earnings’ big leverage to gold prices. Gold’s own mighty cyclical bull has powered 100.1% higher in 23.2 months as of midweek! And amazingly that’s also a single monster upleg, not suffering any 10%+ corrections in its entire lifespan!
Yet GDX’s parallel gains during it are only 164.4%, still merely poor 1.6x upside leverage. At 2x to 3x gold, GDX ought to have soared 200% to 300% by now! The latter 3x calls for GDX near $104, about another 51% higher from current levels. And that’s still conservative. Gold-stock upside leverage to gold grows throughout gold bulls, with outsized proportions accruing near their ends. That makes sense psychologically.
The longer a gold bull runs, and the higher gold stocks rally, the more speculators and investors want to chase that upside momentum. So they increasingly pile in later in big bulls. A monster gold upleg starts at 40% gains, and the last one before today’s crested in early August 2020. GDX’s 134.1% rally to gold’s 40.0% during that one made for fantastic 3.4x upside leverage! It can get much better than 3x in big bulls.
We are already seeing this gold-stock-acceleration dynamic unfolding. Gold miners reported their Q2’25 results from late July to mid-August. Back in late June well before that got underway, I wrote an essay on gold miners stacking records. In it I predicted “They will soon report their best quarter ever by far, their fifth in a row achieving fat windfall profits.” I said those massive earnings would attract professional investors.
Indeed that came to pass. In mid-July just before earnings season, GDX was still trading way down near $51. Yet in the seven-ish weeks since, GDX has soared 34.0% to gold’s 8.7% making for amazing 3.9x upside leverage! Gold stocks need to outperform their metal for a long time to properly leverage its entire mighty bull run. And odds are their ultimate gains will again more than triple gold’s, maybe even quadruple.
We aggressively resumed adding new gold-stock trades in late June leading into Q2 results. The unrealized gains of these young trades are already massive, running as high as +93% midweek! But if you haven’t deployed significant capital in gold stocks yet, I wouldn’t do it here with GDX stretched 46%+ above its 200dma. Buying into extreme overboughtness is never prudent.
A pullback or correction is looming, driven by gold selling off which would pound gold stocks considerably lower. A way-higher-probability-for-success place to add gold stocks would be when GDX again revisits its 50dma, typical major support in ongoing bulls. That’s again running $56.89 as of Wednesday, but rising fast. That’s likely when we’ll add more fundamentally-superior smaller gold-stock trades.
While the major gold miners dominating GDX generally leverage gold 2x to 3x, mid-tiers and juniors push that to 3x to 4x+. They are better able to consistently grow their outputs from smaller bases, and can often operate at lower more-profitable mining costs than majors. So the better smaller gold miners offer both superior fundamentals and bigger upside than majors. We’ve been actively trading them for a quarter-century.
The bottom line is GDX finally bested its all-time-record highs seen a crazy 14 years ago. Gold stocks finally forging back into record territory is a game changer for this sector. It will dramatically ramp bullish financial-media coverage and trader interest, accelerating capital inflows into gold stocks amplifying their gains. Despite revaluing way higher in 2025, gold-stock prices still have far to go to reflect miners’ fundamentals.
Gold miners’ implied unit profits are now running about 2.5x higher than at Q3’11’s last record highs. And gold stocks still have a long ways to run to normally leverage gold’s mighty cyclical bull. Their rich-and-fat earnings continue to support much-higher stock prices, which are still coming. GDX’s new-record territory is closer to the beginning of gold stocks’ long-overdue revaluation higher than its end, which is really bullish.