Here’s the Gold Miner ETF to Buy for the Metal’s Next Run Higher

By Rich Duprey Published Mar 25, 12:35PM EDT

Quick Read

Sprott Gold Miners ETF (SGDM) has declined 2% over the past month but is up down 3% year-to-date, outperforming the market-cap-weighted VanEck Gold Miners ETF (GDX) which is up 0.9% YTD. SGDM’s factor-based construction weights miners by revenue growth, free cash flow yield, and debt-to-equity ratios, filtering for operators with strong financial fundamentals rather than just asset size.
Real interest rates on 10-year Treasuries are the critical driver for SGDM performance over the next 12 months, as gold’s lack of yield makes it increasingly expensive to hold when rates rise; a sustained move below 4% in the 10-year would signal renewed strength for gold miners.
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Here’s the Gold Miner ETF to Buy for the Metal’s Next Run Higher — © Roman Bodnarchuk/Shutterstock.com

Gold miners just handed investors a sharp reminder of how volatile the space can be. The Sprott Gold Miners ETF (NYSEARCA:SGDM) has pulled back -21.16% over the past month and -1.84% over the past week, tracking a sharp retreat in the underlying metal. But the fund’s year-to-date gain of 3.21% against a 0.92% YTD rise for VanEck Gold Miners ETF (NYSEARCA:GDX) illustrates precisely what makes SGDM worth understanding: its factor-based construction tends to hold up better than market-cap-weighted peers when conditions get choppy.

The core problem SGDM was built to solve is one that has long frustrated gold miner investors. Traditional market-cap-weighted funds like GDX give the heaviest allocations to the largest companies regardless of their financial quality, meaning investors often end up overexposed to miners with weak cash flows and bloated balance sheets. SGDM tracks the Solactive Gold Miners Custom Factors Index, which weights companies based on revenue growth, free cash flow yield, and lowest long-term debt to equity, filtering for miners that are actually generating returns rather than just digging gold out of the ground at any cost.

Macro Factor to Watch: Real Interest Rates

The single most important macro variable for SGDM over the next 12 months is the trajectory of real interest rates, which is the 10-year Treasury yield adjusted for inflation expectations. Gold has no yield of its own, so when real rates rise, the opportunity cost of holding gold (and by extension, gold miners) increases. When real rates fall, gold becomes more attractive relative to bonds, and miners tend to amplify that move.

The 10-year Treasury yield currently sits at 4.34%, up 0.26% from a month ago. That monthly rise has coincided with the recent pullback in both gold and mining stocks. The yield peaked at 4.58% in May 2025 before declining to a 12-month low of 3.97% in late February 2026, a period that broadly corresponded with gold’s strongest run. If yields resume their decline toward or below 4%, conditions would favor a renewed leg higher in gold and miners.

Investors should monitor the Federal Reserve’s FRED database for the 10-year yield (series DGS10) on a daily basis, alongside the Fed’s dot plot released at each FOMC meeting, which signals where policymakers expect rates to go. A sustained move below 4% in the 10-year would be a meaningful bullish signal for this fund.

Micro Factor to Watch: The Factor Weighting Methodology at Rebalance

SGDM’s index rebalances periodically to reflect updated free cash flow yield, revenue growth, and debt reduction scores across eligible miners. This is where the ETF can diverge most sharply from peers. Holdings that no longer meet the quality thresholds get trimmed or removed, while improving operators gain weight. Top holdings currently include Agnico Eagle Mines (NYSE:AEM) (10.15%), Newmont (NYSE:NEM) (7.75%), and Wheaton Precious Metals (NYSE:WPM) (7.36%), each of which scored well on the index’s quality factors. If gold prices remain elevated, miners with high operating leverage and strong free cash flow will see their index scores improve, potentially concentrating the fund further in the strongest operators.

The fund holds $662.2 million in total net assets and charges an expense ratio of 0.50%, competitive for a specialized mining fund. Investors should track holdings changes via the Sprott ETFs investor page and the fund’s fact sheet after each rebalance, paying particular attention to whether royalty companies like Wheaton and Franco-Nevada (NYSE:FNV) maintain or grow their weights, as these names carry lower operational risk and tend to hold up better in volatile gold markets.

If the 10-year Treasury yield retreats toward or below 4% as inflation expectations stabilize, SGDM’s quality-screened miners have historically benefited disproportionately in such environments. The next index rebalance will indicate whether the fund’s highest-conviction positions remain the financially strongest names in the sector.

About the Author Rich Duprey →

After two decades of patrolling the dark corners of suburbia as a police officer, Rich Duprey hung up his badge and gun to begin writing full time about stocks and investing. For the past 20 years he’s been cruising the markets looking for companies to lock up as long-term holdings in a portfolio while writing extensively on the broad sectors of consumer goods, technology, and industrials. Because his experience isn’t from the typical financial analyst track, Rich is able to break down complex topics into understandable and useful action points for the average investor. His writings have appeared on The Motley Fool, InvestorPlace, Yahoo! Finance, and Money Morning. He has been interviewed for both U.S. and international publications, including MarketWatch, Financial Times, Forbes, Fast Company, and USA Today.