Gold Majors Got Paid. Now The Explorers Are Next In Line.

Gold had a rough Monday.

Reuters reported:

Gold hits seven-week low as oil surge fuels rate hike bets

“Gold lost more than 3% on Monday to trade at a more than seven-week low, as rising oil prices stoked inflation concerns and bolstered bets on tighter monetary policy, while a higher dollar and Treasury yields created further headwinds for the metal.”

Over the past week, gold fell 4.1% to $4,199. The big gold miners in the GDX fund fell 9.0% while the TSX Venture, home to most junior gold explorers, fell 5.5%.

Needless to say, so far it’s ben week like that hides the bigger picture…

Gold bottomed at $1,845 on October 6, 2023. Since then it’s up 128%. The big producers did even better. GDX is up 243%.

Here’s the whole run, with all three set to 100 at gold’s 2023 low:

As the gold majors got paid, explorers also went up 66%, about half of gold’s gain.

Here’s why:

A major miner digs gold today, so when the price climbs, its profits climb when earnings get reported. An explorer is a bet on gold nobody has pulled out of the ground yet. It needs fresh money from investors to keep drilling, and investors only write those cheques when they feel brave. Otherwise, most of their money comes from the capital markets…

So money tends to move down the line. The metal goes first, then the big producers, then the smaller ones. Explorers come last.

Right now they’re still waiting. Priced in ounces of gold, the TSX Venture sits at 0.211. The record low was 0.184 in April 2025. In April 2006, it was 5.16.

The reading is lower than 98% of all readings since 2001.

Cheap can stay cheap for a long time, what makes this chart worth a look is what explorers did in past gold runs:

From December 2001 to May 2007, gold rose 147% and the TSX Venture rose 225%. From November 2008 to March 2011, gold gained 103% and the explorers gained 200%. In 2016, it was 29% for gold and 69% for explorers.

Over the last several decades gold has had three big runs, and each time the explorers finished ahead. This time, they’re at 66% while gold sits at 128%.

Two things to keep in mind. The TSX Venture isn’t a pure gold index. It’s a mix of small companies, mostly in mining and resources. And one fund with “explorers” in its name, GOEX, is up 309% since October 2023. Its largest holdings are companies that already run mines. The early-stage explorers are the ones left behind. (They’re also the most speculative.)

Explorers are the riskiest corner of the gold market, and plenty of them never find anything worth mining. In all three runs since 2001, the order of profit has held: the metal moved first, the majors got paid, and the explorers finished ahead.

Gold is where you find it…

And right now, the market pays almost nobody to look what’s next in line.