Investing during volatile stock market conditions can be intimidating. The S&P/TSX Composite Index, which is the benchmark for the Canadian stock market, has seen new all-time highs several times this year. As 2026 inches closer, the index is seeing signs of faltering. As of this writing, the index is down by 2.3% from its 52-week high, indicating a downturn in the broader market.
When stocks decline, safe-haven assets like gold tend to rise in value. Many investors consider taking their money out of the market and parking it into assets like gold to hedge against market uncertainty. However, savvier investors typically use market downturns as opportunities to make smarter investments within the market.
Instead of taking your money out of the market entirely, you can consider investing some of it in gold stocks.
Gold mining stocks
Canadian mining stocks have been a source of strength in the last few weeks, thanks to the rally in prices for assets like gold. At the start of 2025, gold was priced at around US$2,600 per ounce. Toward the end of the year, the price of the rare yellow metal is inching closer to US$4,200 per ounce.
Considering the increase in gold prices, investors flocking to buy gold makes sense. However, seasoned investors who are also fans of high gold prices might focus on gold-related stocks. Companies with significant operations related to gold production enjoy better margins during times of higher gold prices. In turn, the companies can deliver more growth to shareholders by driving value.
If you are a fan of where gold prices are going but want to keep your money in the market, gold stocks like Agnico Eagle Mines (TSX:AEM) can be excellent investments to consider.
Agnico Eagle Mines
Considering how high gold prices are now compared to a year ago, virtually any stock with gold-related activities can be a good pick to consider. The TSX has no shortage of gold-mining stocks, but my pick right now would be Agnico Eagle Mines stock.
Agnico Eagle Mines is a $113.4 billion market-cap company engaged in exploring and producing gold. The company is an efficient gold miner, boasting stellar management and a production ramp-up that has let it genuinely leverage the gold boom over the last couple of years.
As of this writing, AEM stock trades for $225.52 per share, down by around 4% from its 52-week high. Despite still being close to all-time highs, AEM stock might have more to deliver in terms of capital gains in the coming weeks.
Foolish takeaway
As gold prices stay within the US$4,000 to US$5,000 range, which many experts expect to be the case for the coming year, AEM stock can be an excellent holding to consider. I have a feeling that investing in AEM stock and some of the other top gold stocks on the TSX could prove to be a worthwhile decision. You get to leverage the performance of gold while keeping your money liquid enough to quickly reposition your portfolio when the market environment favours investing in other areas.
