Best Gold ETFs for Q1 2022

GLDM, SGOL, and BAR are the best gold ETFs for Q1 2022

Gold is a popular asset among investors wishing to hedge against risks such as inflation, market turbulence, and political unrest. Aside from buying gold bullion directly, another way to gain exposure to gold is by investing in exchange-traded funds (ETFs) that hold gold as their underlying asset or invest in gold futures contracts. Some investors view ETFs as a relatively liquid and low-cost option for investing in gold compared to alternatives such as gold futures or shares of gold-mining companies. Still, the price of gold can see big swings, meaning ETFs that track it can also be volatile.

Key Takeaways

  • The price of gold significantly underperformed the broader market over the past year.
  • The ETFs with the best one-year trailing total returns are GLDM, SGOL, and BAR.
  • The sole holding of each of these ETFs is gold bullion.

There are 10 exclusively gold-focused ETFs that trade in the U.S., excluding leveraged or inverse funds, as well as those with under $50 million in assets under management (AUM). These funds either invest directly in gold bullion or in gold futures contracts as opposed to companies that mine for the metal. The benchmark S&P GSCI Gold Index provided a one-year trailing total return of -3.9%, vastly underperforming the S&P 500's one-year total return of 25.6%, as of Dec. 3, 2021. The best-performing gold ETF based on performance over the past year is the SPDR Gold MiniShares Trust (GLDM). We examine the three best gold ETFs below. All numbers below are as of Dec. 3, 2021.

SPDR Gold MiniShares Trust (GLDM)

  • Performance Over One-Year: -3.3%
  • Expense Ratio: 0.18%
  • Annual Dividend Yield: N/A
  • Three-Month Average Daily Volume: 2,683,370
  • Assets Under Management: $4.2 billion
  • Inception Date: June 25, 2018
  • Issuer: World Gold Council

GLDM aims to reflect the performance of the price of gold minus fund expenses. The ETF is structured as a grantor trust, which may provide investors with a certain degree of tax protection. It provides both a cost-effective and convenient way for investors to invest in gold. GLDM tracks the London Bullion Market Association (LBMA) Gold Price as a benchmark. The sole holding of the fund is gold bullion.

Aberdeen Standard Physical Gold Shares ETF (SGOL)

  • Performance Over One-Year: -3.3%
  • Expense Ratio: 0.17%
  • Annual Dividend Yield: N/A
  • Three-Month Average Daily Volume: 1,033,084
  • Assets Under Management: $2.3 billion
  • Inception Date: Sept. 9, 2009
  • Issuer: Abrdn PLC

SGOL is also structured as a grantor trust that seeks to track the performance of the price of gold bullion minus fund expenses. Like GLDM, it's priced lower than many other gold ETFs are. The sole holding of the fund is gold bullion, which is stored in vaults in London and Zurich. A leading physical commodity auditor, Inspectorate International, inspects SGOL's vaults twice a year.

GraniteShares Gold Trust (BAR)

  • Performance Over One-Year: -3.3%
  • Expense Ratio: 0.17%
  • Annual Dividend Yield: N/A
  • Three-Month Average Daily Volume: 621,138
  • Assets Under Management: $872.2 million
  • Inception Date: Aug. 31, 2017
  • Issuer: GraniteShares

Like the funds above, BAR seeks to track the performance of the price of gold bullion minus fund expenses. The ETF is also structured as a grantor trust. BAR is listed on NYSE Arca and can be traded through a normal brokerage account. Also, like the funds above, BAR has a lower expense ratio than many other alternative gold commodity ETFs. The sole holding of the fund is gold bullion, which is stored in vaults in London.

The comments, opinions, and analyses expressed herein are for informational purposes only and should not be considered individual investment advice or recommendations to invest in any security or to adopt any investment strategy. Though we believe the information provided herein is reliable, we do not warrant its accuracy or completeness. The views and strategies described in our content may not be suitable for all investors. Because market and economic conditions are subject to rapid change, all comments, opinions, and analyses contained within our content are rendered as of the date of the posting and may change without notice. The material is not intended as a complete analysis of every material fact regarding any country, region, market, industry, investment, or strategy.

Article Sources

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