Gold Just Dropped: Should TFSA Investors Buy the Dip?

Gold does not drop in a straight line, and a Tax-Free Savings Account (TFSA) does not forgive bad timing. When gold slides, ask why it fell and what could reverse it. A U.S. dollar pop, forced selling, and broad market stress can push bullion down even when the story stays intact. You also need to respect how gold miners behave. A miner can fall harder than gold because investors price in costs, taxes, and operational risk. In a TFSA, that volatility can work for you, but only if you can hold through ugly weeks without blowing up your TFSA plan today.

Consider AEM

Agnico Eagle Mines (TSX:AEM) gives Canadians a solid way to play gold without chasing tiny explorers. It runs mines in Canada and Mexico, and it focuses on long-life assets in stable jurisdictions. Over the last year, it benefited from higher realized gold prices, but it also tightened the business. It leaned into cash generation, balance sheet strength, and disciplined spending.

Recent news also leaned toward cleaning up the toolbox. In the third quarter of 2025, it sold about 38 million shares of Orla Mining for total proceeds of about $560 million. It took an accounting hit tied to the discount and transaction costs, but the move still showed a practical goal: turn investments into cash when prices look right. That kind of decision matters when gold turns jumpy.

The balance sheet story looked even louder. By Sept. 30, 2025, it held cash and cash equivalents of about US$2.4 billion and it carried long-term debt of about US$196 million, which left it with a net cash position of roughly US$2.2 billion. The gold producer entered 2026 with room to fund projects, buy back shares, or wait out volatility. It also set a catalyst, with fourth-quarter and full-year 2025 results scheduled for Feb. 12, 2026.

Earnings support

Those earnings numbers show why investors treat it like a leader. In the third quarter of 2025, Agnico reported net income of US$1.055 billion, or US$2.10 per share. It reported adjusted net income of US$1.085 billion, or US$2.16 per share. It also produced 866,936 ounces of gold in the quarter.

Costs still matter after a gold dip. In that same quarter, management reported all-in sustaining costs of US$1,373 per ounce, up from US$1,286 a year earlier. It also generated free cash flow of about US$1.19 billion for the quarter. That mix tells a simple story. It prints cash at strong gold prices, but it still faces inflation, labour pressure, and energy swings that can pinch margins when bullion cools.

The outlook now depends on whether gold’s drop marks a reset or a trend. At writing, spot gold fell about 2% amid a firmer U.S. dollar and liquidation pressure. If that move fades, a miner with net cash and free cash flow can look attractive on a rebound. If the slide continues, miners can keep dropping even when operations run well, because sentiment turns fast in this sector.

Bottom line

So should TFSA investors buy the dip in this one? It can work if you want exposure to gold and you can handle the roller coaster, and you can size it modestly first. It offers scale, cash generation, and a net cash balance that reduces stress when prices swing. The risk stays real, because costs can rise, mines can surprise, and gold can keep falling when markets de-risk. If you want a miner you can hold through chaos, this gold stock fits better than most, but you still need a steady stomach.

The post Gold Just Dropped: Should TFSA Investors Buy the Dip? appeared first on The Motley Fool Canada.

Should you invest $1,000 in Agnico Eagle Mines right now?

Before you buy stock in Agnico Eagle Mines, consider this:

The Motley Fool Canada team has identified what they believe are the top 10 TSX stocks for 2026… and Agnico Eagle Mines wasn’t one of them. The 10 stocks that made the cut could potentially produce monster returns in the coming years.

Consider MercadoLibre, which we first recommended on January 8, 2014 … if you invested $1,000 in the “eBay of Latin America” at the time of our recommendation, you’d have $21,827.88!*

Now, it’s worth noting Stock Advisor Canada’s total average return is 102%* – a market-crushing outperformance compared to 81%* for the S&P/TSX Composite Index. Don’t miss out on our top 10 stocks, available when you join our mailing list!

Get the 10 stocks instantly #start_btn6 { background: #0e6d04 none repeat scroll 0 0; color: #fff; font-size: 1.2em; font-family: 'Montserrat', sans-serif; font-weight: 600; height: auto; line-height: 1.2em; margin: 30px 0; max-width: 350px; text-align: center; width: auto; box-shadow: 0 1px 0 rgba(0, 0, 0, 0.5), 0 1px 0 #fff inset, 0 0 2px rgba(0, 0, 0, 0.2); border-radius: 5px; } #start_btn6 a { color: #fff; display: block; padding: 20px; padding-right:1em; padding-left:1em; } #start_btn6 a:hover { background: #FFE300 none repeat scroll 0 0; color: #000; } @media (max-width: 480px) { div#start_btn6 { font-size:1.1em; max-width: 320px;} } margin_bottom_5 { margin-bottom:5px; } margin_top_10 { margin-top:10px; }

* Returns as of January 15th, 2026

More reading

• 5 Canadian Stocks to Watch as January Sets the Tone for 2026
• 3 Blue-Chip Stocks Every Canadian Should Own
• 2 TSX Stocks That Could Be Overdue for a January Jump
• Get Set for Success: My Top 2 Canadian Stock Picks for 2026
• Outlook for Agnico Eagle Mines Stock in 2026

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.