It sure has been an interesting year for the gold price, and for all ASX mining shares whose fortunes ride or die on it.
The yellow precious metal started the year trading for just over US$1,830 an ounce. Today that same ounce will set a gold investor back US$1,965 at the time of writing. That's a gain of roughly 7.4%.
Gold is one of the more interesting commodities to track. Unlike base metals such as iron ore, copper, or aluminium, the gold price doesn't just rise and fall based on economic growth.
Why has the precious metal lifted in 2023?
Gold does have some industrial applications but its largest markets are for jewellery and investment. Investors around the world use gold in their portfolios, thanks to its alleged status as an inflation hedge and a safe haven asset.
The yellow metal is often accumulated by investors during times when political, geographical, or economic tensions are rising.
This comes down to a belief that the inherent value of gold cannot be challenged by governments or, by extension, central banks.
Gold cannot be printed, or diluted by governments using quantitative easing, or any of the other methods that have been used to provide economic stimulus in the past. Thus, some investors feel safer storing their wealth in gold than in government bonds, cash, or shares during tough times.
And 2023 has seen its fair share of economic woes. Inflation has continued to rage as a pressing concern all over the world this year so far. And with rising interest rates getting investors worried that we could be heading for an interest rate-induced recession, it's not really a surprise to see the gold price climb in value over the year to date.
This obviously bodes well for ASX gold shares. But which gold miners have gained the most in 2023 from this gold price surge? That's what we'll be determining today.
Which ASX mining shares have profited from gold's price surge in 2023?
You would think that this healthy rise we've seen in the gold price over 2023 thus far would have resulted in most ASX gold mining shares shooting the moon, given the leveraged nature of a mining company's profits against the underlying price of the commodity they sell. But you'd be wrong.
Most ASX gold mining shares have actually had rather lacklustre years. Take Gold Road Resources Ltd (ASX: GOR). Its shares have lost 7.5% over 2023 thus far, falling from around $1.73 a share to the $1.60 we see today.
It's even worse for popular ASX gold miner Perseus Mining Ltd (ASX: PRU). Its shares have spent this year dropping from $2.12 each to $1.705 at the time of writing — that's a drop of almost 20%.
But there have been a few notable winners. One is Evolution Mining Ltd (ASX: EVN). Evolution shares have rocked since January, rising from $3.04 to the $3.61 the miner is going for at present. That's a gain of almost 19%.
But even this gain isn't enough for Evolution to claim the ASX gold mining share crown for the year to date. That honour goes to the ASX's largest gold mining share Newcrest Mining Ltd (ASX: NCM).
Newcrest claims the gold medal
Newcret shares have been on a tear this year. This gold stock started 2023 at $20.84 a share. But today, those same shares are trading for $26.50 each. That represents a rise of 27.2% year to date for Newcrest Mining, as you can see below:
Of course, Newcrest has one decisive factor in its favour, which probably explains its market outperformance. Back in February, the company announced that it had received (and rejected) a takeover offer worth $27.40 per share, from the US gold mining giant Newmont Corporation.
Then, in May, Newcrest revealed that a newer offer from Newmont, worth $29.27 per share, had received the green light. This means that Newcrest is on track to merge with Newmont by the end of 2023. Newcrest investors will receive 0.4 Newmont shares (in a new ASX listing) for every Newcrest shares owned.
So obviously this deal has turbocharged the Newcrest share price over the year, and has resulted in this company claiming the crown of best-performing ASX gold mining share in 2023 thus far.
