Vanguard Precious Metals and Mining Fund Investor Shares mutual fund (“VGPMX”) was created in 1984 with the investment objective of seeking long-term capital appreciation. The fund invests the majority of its assets in foreign and U.S. companies, with operations in mining, exploration, fabrication, processing, distribution development and marketing of metals and minerals.
A large portion of these companies are primarily engaged in operations that relate to gold, silver, platinum and various other precious metals and minerals. The fund is nondiversified, and has $1.86 billion in net assets with an expense ratio of 0.29%. As of Feb. 29, 2016, VGPMX had a year-to-date return of 20.75%. Although the fund is performing well year to date, it is underperforming several of its peers, such as the Fidelity Select Gold Portfolio (“FSAGX”). The top five holdings of VPGMX are Agnico Eagle Mines Ltd. (NYSE: AEM), with an allocation of 7.33%, Nevsun Resources Ltd. (NYSE: NSU), with an allocation of 6.85%, Randgold Resources Ltd. (NASDAQ: GOLD), with an allocation of 6.21%, Dominion Diamond Corp. (NYSE: DDC), with an allocation of 5.53% and Goldcorp Inc. (NYSE: GG), with an allocation of 4.90%.
Agnico Eagle Mines Ltd.
Agnico Eagle Mines is a Canadian gold producer with operations in Quebec, Finland, Nunavut and Mexico. The company also has exploration activities in several other geographic locations, including Europe, Latin America and the United States. The company’s development, expansion and exploration activities consist mainly of below-the-surface operations.
As of March 19, 2016, Agnico Eagle Mines had a market capitalization of $10.84 billion, a one-year return of 33.65% and a P/E ratio of 224.31.
Nevsun Resources Ltd.
Nevsun Resources is a Canadian copper production company. It operates the Bisha Mine, which commenced commercial production in 2011 and has since produced gold-silver dore and copper. Nevsun is looking at the possibility of having the Bisha Mine's operations expand into zinc concentrates.
As of March 19, 2016, Nevsun Resources had a market capitalization of $901 million, a one-year return of 4.21% and a P/E ratio of 29.75.
Randgold Resources Ltd.
Randgold Resources is a gold mining services company with operations predominately based in Mali, Africa. The company specializes in exploration, acquisition and development of gold and precious metals. Additional to the Mali operations, the company operates mines in Ivory Coast and the Democratic Republic of Congo.
As of March 19, 2016, Randgold Resources had a market capitalization of $3.64 billion and a one-year return of 1.69%.
Dominion Diamond Corp.
Dominion Diamond Corporation operates mines and markets rough diamonds predominately in Canada’s Northwest Territories. The company has a sizable stake in the Diavik Diamond Mine Project, which is operated by its joint venture partner Diavik Diamond Mines Inc. Dominion Diamond also has business interests in India and Belgium.
As of March 19, 2016, Dominion Diamond had a market capitalization of $1.331 billion, a one-year return of negative 27.95%, and a P/E ratio of 194.40.
Goldcorp is a Canadian company, and it is one of the world’s largest gold producers. The company’s primary gold mining activities include processing, exploration, reclamation and extraction in locations such as the U.S., Canada, South and Central America and Mexico. Goldcorp has had its fair share of controversy, as the company has been accused by activists and advocacy groups of harming the environment with its mining activities.
As of March 19, 2016, Goldcorp had a market capitalization of $18.23 billion and a one-year return of negative 7.97%. This company does not have a P/E ratio as its earnings per share (EPS) is negative.