Gold ETFs Still Shine in a Diverse Portfolio

According to some analysts, gold may hold the bulk of this run

Gold ETFs, or exchange-traded funds, are investment funds that are designed to track the price of gold. They are listed and traded on stock exchanges, and investors can buy and sell shares of these funds just like stocks.

Gold ETFs provide a way for investors to gain exposure to the price of gold without actually owning physical gold. By buying shares in a gold ETF, investors can participate in the potential price appreciation of gold, as well as any dividends or interest income earned by the ETF.

Some advantages of investing in gold ETFs include:

Diversification

Gold ETFs can be a valuable addition to a diversified investment portfolio, as they can provide a hedge against inflation and economic uncertainty.

Convenience

Gold ETFs can be bought and sold just like stocks, making them easy to trade and access for investors.

Low fees

Gold ETFs typically have lower fees than actively managed funds, as they are designed to track the price of gold rather than trying to outperform it.

There are several types of gold ETFs, each with its own unique investment objective and strategy. Some of the common types of gold ETFs include:

Physical gold ETFs

These ETFs hold physical gold as their underlying asset. They are designed to track the price of gold, less any expenses incurred by the ETF.

Gold mining ETFs

These ETFs invest in companies that are engaged in the exploration, mining, and production of gold. They offer exposure to the gold industry as a whole, rather than just the price of gold.

Leveraged and inverse gold ETFs

These ETFs use derivatives to provide leveraged exposure to the price of gold, or to offer inverse exposure (i.e., profits when gold prices fall). However, these ETFs are generally riskier than traditional gold ETFs and are intended for experienced investors who are willing to take on higher levels of risk.

However, like all investments, there are risks associated with gold ETFs. The price of gold can be volatile, and ETFs can be affected by factors such as changes in interest rates, currency fluctuations, and geopolitical events. It is important for investors to do their own research and understand the risks before investing in gold ETFs.

Here's a look at some of the leading gold ETFs:

SPDR Gold Shares (GLD)

This is the largest and most widely traded gold ETF in the world, with over $50 billion in assets under management. It holds physical gold bullion as its underlying asset and has a low expense ratio of 0.40%.

iShares Gold Trust (IAU)

This is another popular gold ETF that holds physical gold as its underlying asset. It has over $20 billion in assets under management and a low expense ratio of 0.25%.

VanEck Vectors Gold Miners ETF (GDX)

This ETF invests in companies that are engaged in the exploration, mining, and production of gold. It has over $10 billion in assets under management and a relatively high expense ratio of 0.52%.

Aberdeen Standard Physical Gold Shares ETF (SGOL)

This ETF holds physical gold as its underlying asset and has a low expense ratio of 0.17%. It has over $3 billion in assets under management.

Invesco DB Gold Fund (DGL)

This ETF uses futures contracts to track the price of gold. It has over $300 million in assets under management and a relatively high expense ratio of 0.75%.

Invesco Physical Gold ETF (PHYS)

This ETF holds physical gold bullion as its underlying asset and has over $2 billion in assets under management. It has a relatively low expense ratio of 0.17%.

ProShares Ultra Gold (UGL)

This is a leveraged gold ETF that seeks to provide twice the daily return of gold bullion. It uses futures contracts and has an expense ratio of 0.95%.

VanEck Merk Gold Trust (OUNZ)

This ETF holds physical gold as its underlying asset and allows investors to redeem their shares for actual gold bullion. It has over $1 billion in assets under management and an expense ratio of 0.40%.

GraniteShares Gold Trust (BAR)

This ETF holds physical gold as its underlying asset and has a low expense ratio of 0.1749%. It has over $500 million in assets under management.

Gold miner ETFs are a type of ETF that invests in companies engaged in gold mining and exploration. These ETFs offer exposure to the gold mining industry and can be a way to gain indirect exposure to the price of gold. Here are some popular gold miner ETFs:

VanEck Vectors Gold Miners ETF (GDX)

This is one of the most popular gold miner ETFs, with over $10 billion in assets under management. It seeks to track the performance of the NYSE Arca Gold Miners Index, which includes companies engaged in gold mining and exploration.

VanEck Vectors Junior Gold Miners ETF (GDXJ)

This ETF focuses on smaller companies engaged in gold mining and exploration. It has over $6 billion in assets under management and seeks to track the performance of the MVIS Global Junior Gold Miners Index.

iShares MSCI Global Gold Miners ETF (RING)

This ETF invests in companies engaged in gold mining and exploration around the world. It has over $800 million in assets under management and seeks to track the performance of the MSCI ACWI Select Gold Miners Investable Market Index.

Sprott Junior Gold Miners ETF (SGDJ)

This ETF focuses on small and mid-cap gold mining companies. It has over $100 million in assets under management and seeks to track the performance of the Solactive Junior Gold Miners Custom Factors Index.

Direxion Daily Gold Miners Index Bull 2X Shares (NUGT)

This is a leveraged ETF that seeks to provide 2x the daily return of the NYSE Arca Gold Miners Index. It uses derivatives to achieve its objective and has an expense ratio of 1.05%.

Investors should carefully consider the investment objectives, risks, and expenses of each gold ETF before investing. They should also consider the fund's underlying asset, investment strategy, and historical performance. Additionally, it is important to have a diversified portfolio that includes a mix of asset classes and investment strategies, rather than relying solely on one investment, such as a gold ETF.

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