4 Gold ETFs at a Glance

4 Gold ETFs at a Glance

Exchange-traded funds, or ETFs, have existed since 1993, according to Forbes, though they became much more common in the early 2000s. Since then they have risen in popularity, with net assets held by ETFs currently amounting to $1.34 trillion. 

Gold ETFs allow investors to have exposure to the metal without personally trading physical gold or gold futures. Here’s an overview of five such ETFs:

SPDR Gold Trust (ARCA:GLD)

The SPDR Gold Trust tracks the spot price of gold bullion and is determined by market forces in the 24-hour, over-the-counter market for gold. This market accounts for most global gold trade, and any quoted prices available to ETF investors reflect the latest available information.

Physical bullion comprises 100 percent of the ETF’s holdings, and its expense ratio per share is 0.4 percent. It offers investors a way to get involved in the gold market in a way that is much less costly than purchasing, storing and insuring physical gold.

iShares Gold Trust (ARCA:IAU)

Like the SPDR Gold Trust, the iShares Gold Trust aims to track the spot price of gold bullion and is listed on the NYSE Arca. Its expense ratio for investors is 0.25 percent, and its holdings are allocated entirely to physical gold bullion. The ETF’s goal is for its value to reflect the price of all of the gold it owns at a given time, less expenses and liabilities.

The physical gold the ETF holds is held by its custodian in vaults in New York, Toronto, London and other locations. Investors can purchase and sell shares through traditional brokerage accounts throughout the trading day. Over the past five years, the iShares Gold Trust has achieved a return of 43.39 percent.

ETFS Physical Swiss Gold Shares

ETFS Physical Swiss Gold Shares are issued by the ETFS Gold Trust (ARCA:SGOL). The aim of the ETFS Gold Trust is for its shares to reflect the performance of the price of gold bullion less the Trust’s operating expenses. The shares trade on an exchange like any other security, and can be created and redeemed as supply and demand in the market dictates and allows.

The gold that the ETFS Physical Swiss Gold Shares owns is held in Zurich, Switzerland; it conforms to the London Bullion Market Association’s rules for Good Delivery. Over the past three years, the ETFS Physical Swiss Gold Shares has achieved a return of -7.36 percent. Its 200-day volatility stands at 16.23 percent.

PowerShares DB Gold Double Long ETN (ARCA:DGP)

The PowerShares DB Gold Double Long ETN is a rules-based index composed of gold futures contracts. It is intended to reflect the performance of gold. Specifically, PowerShares tracks changes in the level of the DBIQ Optimum Yield Gold Index Excess Return plus interest income from its holdings of US Treasury securities, but minus the Fund’s own expenses. It is not possible to invest directly in the index.

Over the past five years, the PowerShares DB Gold Double Long ETN has achieved a 34.24-percent return. Its expense ratio is 0.79 percent.

Along with the PowerShares DB Gold Fund (ARCA:DGL) and PowersShares DB Gold Double Short ETN (ARCA:DZZ), the PowerShares DB Gold Double Long ETN provides investors with a way to “take a short or leveraged view on the performance of gold.”

 

Related reading: 

5 Silver ETFs at a Glance

3 Copper ETFs at a Glance