Gold ETFs Explained

Gold ETFs (Exchange-Traded Funds) provide a convenient way to gain exposure to gold without handling physical metal.

SPDR Gold Shares (GLD) is the largest gold ETF with over $50 billion in assets. Each share represents approximately 1/10th of an ounce of gold. It tracks the London gold price and stores physical gold in HSBC vaults in London.

iShares Gold Trust (IAU) is similar to GLD but with a lower expense ratio (0.25% vs 0.40%). Each share represents approximately 1/100th of an ounce. Its lower share price makes it more accessible for smaller investors.

VanEck Gold Miners ETF (GDX) holds shares of major gold mining companies like Newmont, Barrick Gold, and Franco-Nevada. It provides leveraged exposure to gold prices through mining operations.

VanEck Junior Gold Miners ETF (GDXJ) focuses on smaller, earlier-stage gold mining companies. It offers higher potential returns but with greater volatility and risk.

Aberdeen Physical Gold Shares (SGOL) stores its gold in Swiss vaults rather than London, offering geographical diversification. It has a competitive expense ratio of 0.17%.

When choosing a gold ETF, consider the expense ratio, tracking accuracy, liquidity, and whether you prefer physical gold backing or mining company exposure.