Experts Top 5 Gold ETFs

Markets are starting to realize that maybe the Fed hasn’t gotten inflation under control.

In the last month, gold prices have soared as investors look for a safe haven.

State Streets Gold Trust ETF (GLD) topped the list of gold ETF searches this month by financial pros, and for good reason.

It’s one of the most popular in terms of volume and liquidity, boasting more than $62 billion under management.

But, is it the right one for your portfolio?

Key Facts About GLD

• Net assets: $62.4 billion
• 12-month trailing yield: N/A
• Inception: November 18, 2004
• Expense ratio: 0.40%
• Number of holdings: 1

State Street’s GLD Trust is a bit different from most ETFs.

Instead of owning part of a basket of equities, shares entitle you to a portion of physical gold being held in vaults.

This helps prevent solvency issues, giving investors peace of mind.

Consequently, the only holding in the portfolio is…gold.

The GLD ETF has been around for almost 20 years, and is one of the most actively traded with more than 10 million shares changing hands every day, along with options that expire weekly.

Performance

Because the ETF holds physical gold, its value deviates only slightly from the spot market rate of gold.

Thus, the performance of the GLD largely mirrors the performance of physical gold.

Source: StateStreet

Competition

Despite being a fairly bland and straightforward investment, several other ETFs compete in the space. 

And there’s one that’s particularly interesting.

• Perth Mint Physical Gold ETF (AAAU): The key difference with this ETF is the lower expense ratio running just 0.18%. 
• ProShares Ultra Gold (UGL): UGL is a leveraged ETF that gives the holder exposure to twice the daily performance of gold.
• GraniteShares Gold Trust (BAR): BAR is similar to AAAU and GLD except it runs an even cheaper expense ratio of 0.17%.
• iShares Gold Trust (IAU): iShares version of the gold ETF is the second most popular behind GLD, but with a notably lower expense ratio.

It’s interesting to see how the overall performance is directly linked to the expense ratio.

Our Opinion 7/10 

While the GLD is a favorite for many investors, we prefer those with lower expense ratios.

We’d go with the IAU as a happy medium where you get cheaper fees but still plenty of liquidity and options activity.

But if you want the cheapest, BAR is your best bet.

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