What people may not understand is that when general market...

What people may not understand is that when general market sentiment is bad, commodity stocks may not follow the direction of their underlying commodity or to the same degree; they are all equities. They don't suffer equally but they do because of mean reversion and market internals are now weak.

During these times, buying gold stocks is not the same as buying Gold (physical/digital), and at some point you're going to see that with energy stocks with juniors first off the cab to seriously retrace. We also just saw how one gold project no longer became viable because of soaring cost of operations. Physical Gold does not have that problem.

Market participants too fixated on indices, too fixated on commodity prices as forward guide to their individual stock prices. The correlation is stronger during the bullish phase but not so when the bear reigns. And the reason: market looks months ahead to anticipate weakness in commodity prices as recession bites. Just like the banks corrected after the RBA/Fed became hawkish and dont mince words about raising rates harder, markets look ahead at prospects of increasing NPLs and a fall in loan growth. A recession will eventually bring all prices down. You just don't see it yet.