This Gold Stock is One of the Best to Own in August

Newmont stock has generated impressive August returns over the past 10 years

Deputy Editor
Aug 5, 2020 at 1:56 PM
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    As covered in this fascinating trader Q&A, nothing is as hot as gold right now. That means big gains for Newmont Corporation (NYSE:NEM), which just hit a new all-time high of $72.22 earlier today. Better yet, there could be more upside coming soon, as the mining company -- who specializes in the production and exploration for gold -- enters a historically bullish month. 

    According to data from Schaeffer's Senior Quantitative Analyst Rocky White, over the last 10 years, NEM has been one of the best stocks to own in August. In fact, the equity is the only mining stock that is featured on White's list of best S&P 500 stocks to own this month, and boasts an average return of 7.3%, with 70% of the returns positive.

    A move higher of similar magnitude would put NEM at a fresh record high. Of course, the stock did go in the opposite direction of its July monthly signal. But between the pandemic, an upcoming volatile election, plus a soft U.S. dollar, there certainly seems to be bullish appeal to bullion in the coming months. Longer term, Newmont Mining has more than doubled off its March 16 lows of $33, with support for a June pullback contained by its 100-day moving average.

    NEM Chart August 5

    Now looks to be an attractive time to bet on the equity's next moves with options. This is per NEM's Schaeffer's Volatility Index (SVI) of 43%, which sits in the 25th percentile of its annual range. In simpler terms, options players are pricing in relatively low volatility expectations right now.

     

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