It’s the news that Wall Street wants to ignore but can’t — precious metals, particularly gold and silver, are tearing up the markets. Gold is rapidly approaching the $1,300 price point, a level which has not been seen since the first quarter of 2015. On the other hand, silver is close to breaching $18, another one-year record. While there’s plenty of evidence that the precious metals bull market is back in full swing, investors may also want to consider gold and silver stocks.

The thesis for investing in the metals mining sector is fairly straightforward — you can’t get physical bullion unless you dig it out of the ground. Mining companies also play an important role in manufacturing and industry. In fact, most miners simply wouldn’t be profitable extracting just precious metals. Silver, for example, is a byproduct of nickel mining, which on volume generates more revenue for the mining company.

That’s not to say gold and silver are merely leftover scraps to be sold as a form of supplemental income. Indeed, when the precious metals market tanked, many miners suffered intractably. Partly, this is due to the fact that commodities in general tend to trade in tandem — what’s good for gold is also good for aluminum or other industrial metals. But miners have been making tons of money on gold and silver during the run-up of the 2000s bull market, and they were taking more risks under the assumption that the price of the precious metals would be relatively stable.

Precious Metal Miners to Jump Skyward In 2016 - 2017

That assumption of course was wrong, and the remaining survivors in the mining industry had to make painful adjustments. Expectations on earnings performance have also been tapered down. With the passage of time, it can be reasonably argued that the worst for the mining companies is over. The industry is leaner and meaner and ready to take advantage of any tailwind in the underlying metals market.

The catapult in gold and silver prices, however, is probably more than what many miners expected. With the adjustments made in their financials, any increase in the metals’ spot-price beyond a certain threshold is “bonus profit.” That’s one major reason why the Gold and Silver Index (XAU) — a benchmark for the precious metals mining industry — is up 100% year-to-date. In contrast, the gold spot price is up 20.6% YTD, whereas silver is up 29%.

Mining companies have more “speculative potential” because they are, at their heart, an equity stock as opposed to a hard asset. Investors are not necessarily gambling on the precious metals bull market but rather, how miners will benefit from the underlying market. That distinction is blurred, of course, since miners almost always benefit from higher metal spot prices. Nevertheless, it is an important distinction. Mining investment is essentially speculation on other people speculating.

During a commodity market downturn, the mining industry can be downright awful. But when the wind is at its back, it’s hard to stop the positive momentum, as you can see from the XAU chart. As the gold and silver bull gets stronger and stronger, consider looking at the mining industry. It can help supplement an incredible swing occurring in the markets.