I don't personally hold any of the majors in the PM sector but apparently the reason they have not gone up during the recent rise is because of the hedge fund practice of long short trades.

They are long the physical and short the majors. The higher gold and silver go the more shorts they put on.

If gold keeps rising the majors are eventually going to become very profitable and will be raising their dividends. This could result in a major short squeeze.

I can think of some other reasons why the majors haven't gone up.

Some of them use forward sales to smooth earnings or finance expansion - in the case of bank financing this is often required. Let's say you sold forward half your annual production at $1000 oz. Let's also say you had a set-back of some sort - mine accident, government interference, workers strike - that cuts into production. Now the percentage of gold you have to deliver at $1000 goes up in relation to your total production, leaving less to sell at today's higher price.

Even without a set-back, forward sales work against you in a rising market. The trade off is less volatility in your stock price vs. short term underperformance. Some larger companies might find this acceptable, especially if they pay out earnings in dividends to investors who are in for the long run and don't worry too much about the day to day share price.

Rising costs, especially energy. This is damaging for low-margin operators, but even the best run operations will feel the pinch, especially when oil runs amok, like it has lately.

Reserve replacement. The bigger you are, the harder it is to replace reserves. You have to go into riskier areas, or settle for lower grades with higher operating costs. You also have to pay a premium for these deposits as speculators run the price, knowing you have no choice but to pay up.

ebear