So the key thing to note coming into 2013 is commodities are one of the only sectors with two years of negative returns coming into the year. There’s no doubt value investors and contrarians will be taking notice. There’s research that shows that assets that have negative returns for two and three years in a row tend to outperform on the upside when they eventually mean revert.
Within the commodities sector gold miners are overdue for mean reversion not only against gold but against the stock market in general. Three years of negative returns in a row is pretty rare, so there’s a good chance the mean reversion for gold stocks will start this year. Especially considering gold likely put in amajor bottom last summer, and could be coming off of a successful retest of that bottom to start the year.
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