A feature of gold, silver, and mining stocks is seasonality. Seasonality occurs due to fluctuations in supply and demand. For example, the mining supply of gold is usually pretty steady throughout the year. However, demand does vary throughout the year for a variety of reasons. Festivals are held at specific times of the year such as Chinese new year in February and in eastern countries gold is bought in large quantities during festival time. Portfolio balancing occurs at specific times of the year and of course tax selling can particularly affect the mining stocks.
The best months to buy and sell gold
The chart above shows the seasonality of the gold price based on data from 1986 to 2016. It covers a long time span including both bear and bull markets. The values are indexed to 100 in January. The numerical values are therefore not very important here, what we are looking for is the direction of movement, and the peaks and the dips.
The gold price tends to be weakest in late March and a particularly strong dip occurs in mid to late June. Dips in the gold price also occur in late October and just before Christmas. Gold price tends to rise significantly from January to late February and from June until mid September.
Note that this chart this does not include data from the recent bull run in gold. Does this affect seasonality?
The above chart uses data from the last 24 years and does include 2020 data. The overall pattern is actually still similar. Two significant increases in gold price occur from January and from July. The best months to buy gold are again are mid March, early July, late October, and mid December.
- Best Months to buy gold
- Late March
- Late June
- Late October
- Mid December
- Best months to sell gold
- Late February
- Late September
The best months to buy and sell silver
The chart above shows the seasonality of the silver price from 1986 to 2016. The largest price rise occurs from January to late April and from late June to late July. The best times to buy silver are late June and late October.
The chart above covers a longer time scale of 69 years. This confirms that that the best times to buy silver are late June and late October to December. The best times to sell silver are late February and late September.
- Best months to buy silver
- Late June
- Late October
- Mid December
- Best months to sell silver
- Late February
- Late September
Best months to buy and sell gold mining stocks
The above chart shows that the seasonality of gold mining stocks is similar to that of the gold price. Interestingly, the gold mining stocks are affected quite badly at the end of the year, much more so than gold. The largest drop in occurs from October to December, representing buying opportunities. Of course individual gold mining stocks will behave differently from the gold mining indices themselves and so remember that this only provides a generalized guide.
- Best months to buy gold mining stocks
- Mid March
- Late July
- November to mid December
- Best months to sell gold mining stocks
- Late February
- Late September
Effect of election year on gold price seasonality
Shown above is a seasonal chart of gold price over the past 45 years but it has been filtered to only include US presidential election years. The elections are usually held in November and indicates that gold prices tend to drop in October and then just before the election, gold price tends to rise into November.
Conclusions
Overall it is clear that that there are optimum months for buying gold, silver, and gold mining stocks. Generally, the best times to buy are mid-year and towards the end of the year.
Gold and Silver Assets 