Amex launches gold index

The American Stock Exchange has started publishing the Amex Gold Miners Index under the ticker symbol gdm.

The index is designed to be a barometer of gold and silver mining; it weighs the various market caps of publicly traded companies mostly involved in mining gold and silver.

The index includes common stocks of selected companies with market caps greater than US$100 million that have an average daily volume of at least 50,000 shares over the previous six months.

Amex says it could eventually list an exchange-traded fund based on the index.

Over the 5-year period ended Sept. 30, 2004, the Amex Gold Miners Index had a cumulative return of 92.99% and an annualized return of 14.04%.

The Amex Gold Miners Index fills a market void for a broad-based index of gold shares. As it stands, the index covers 36 companies, up to three times the number of companies as other indices of gold stocks and includes large-cap and small-cap companies, according to Joe Foster, portfolio manager of the Van Eck International Investors Gold Fund.

Says Foster: “The new Amex Gold Miners Index combines emerging producers with established miners to reflect a cross-section of the market. With this more comprehensive representation, the Amex Gold Miners Index may become the benchmark for the industry.”