The Worst Gold Stock to Own in November

The equity is underperforming a notable precious metal ETF

Deputy Editor
Oct 31, 2022 at 1:16 PM
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Gold's appeal is dim today, as the strengthening U.S. dollar and looming interest rate hike from the Federal Reserve weigh on the safe-have metal. Looking a bit further back, gold prices have struggled for the last six months, with the iShares MSCI Global Metals & Mining Products ETF (PICK) shedding 17.5% in that timeframe. Gold producer Newmont Corporation (NYSE:NEM) is suffering even worse, sporting a 41.4% six-month deficit. And to add insult to injury, NEM is entering a historically bearish month.

Best of November 2022

Per data from Schaeffer's Senior Quantitative Analyst Rocky White, Newmont stock is one of the worst-performing stocks on the S&P 500 Index (SPX) in the last 10 years. The shares have averaged a November return of -4.4% in the last decade, finishing the month with a positive return just three times. This makes the equity the second worst performer on the list. Last seen down 1% at $42.43, Newmont stock has been facing off with its 40-day moving average in recent weeks. NEM is off 31.6% year-to-date.

NEM Chart October 312022

An unwinding of optimism among options traders could create additional headwinds for the equity. Newmont stock sports a 10-day call/put volume ratio of 5.06 at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which sits in the 78th percentile of its annual range. This suggests options traders are picking up calls at a much quicker-than-usual clip. 

It's also worth noting Newmont stock's Schaeffer's Volatility Scorecard (SVS) ranks at a slightly elevated 73 out of 100. In other words, the equity tends to outperform options traders' volatility expectations.


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