5 Biggest Gold ETFs in 2024
Xuan-Ce Wang
GeoVision AI: An AI-powered Decision Platform that will Shift the Paradigm of the Mining Value Chain
Abstract:
Gold exchange-traded funds (ETFs) have emerged as popular investment vehicles for individuals seeking exposure to the precious metal without the complexities of physical ownership. This report explores the concept of gold ETFs, their advantages, and considerations for investors. The five largest gold ETFs in 2024, based on total assets, are analyzed in detail, providing insights into their objectives, compositions, expense ratios, and other relevant factors. Investors can use this information to make informed decisions about including gold ETFs in their investment portfolios.
What Are Gold ETFs?
Gold exchange-traded funds (ETFs) have gained significant popularity among investors seeking exposure to precious metals. But what exactly are they?
- Definition: Gold ETFs are investment vehicles that track the price of gold bullion. They operate similarly to mutual funds but with a crucial distinction: ETFs can be bought and sold on exchanges, making them highly accessible.
- Composition: These funds hold physical gold or derivatives linked to gold prices.
- Flexibility: ETFs offer considerable flexibility for implementing various investment strategies and constructing diversified portfolios.
Why Consider Gold ETFs?
1). No Physical Ownership: Unlike owning physical gold (such as coins or bars), investing in gold ETFs doesn't require you to handle or store the metal.
2). Cost-Effective: Gold ETFs provide a cost-effective way to gain exposure to gold without trading gold futures.
3). Liquidity: ETFs can be traded throughout the trading day, providing liquidity and ease of entry or exit.
4). Diversification: Investors can diversify their portfolios by including gold ETFs alongside other assets.
Gold ETFs offer a convenient and efficient way to participate in the gold market without the complexities of physical ownership. Let's explore the five largest gold ETFs based on total assets.
5 Biggest Gold ETFs in 2024
1. SPDR Gold Shares (ARCA: GLD)
?? - Total Assets: US$62,750 million
?? - Objective: The SPDR Gold Shares aims to track the spot price of gold bullion. It operates in the 24-hour, over-the-counter market for gold, which constitutes most of the global gold trade.
?? - Composition: 100% physical bullion forms the ETF's holdings.
?? - Expense Ratio: 0.4%
?? - Investment Advantage: Investors gain exposure to gold without the costs associated with purchasing, storing, and insuring physical bars or coins.
2. iShares Gold Trust (ARCA: IAU)
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?? - Total Assets: US$29,019.7 million
?? - Objective: Similar to SPDR Gold Shares, the iShares Gold Trust also aims to track the spot price of gold bullion.
?? - Composition: Holdings consist entirely of physical gold bullion.
?? - Expense Ratio: 0.25%
?? - Storage Locations: Vaults in New York, Toronto, London, and other locations.
?? - Trading: Investors can buy and sell shares throughout the trading day via traditional brokerage accounts.
3. SPDR Gold MiniShares Trust (ARCA: GLDM)
?? - Total Assets: US$7,673.1 million
?? - Expense Ratio: Offers one of the lowest expense ratios for a US-listed ETF backed by physical gold.
?? - Composition: Represents fractional, undivided beneficial ownership interests in the trust, which holds physical gold bullion and occasional cash.
4. Abrdn Physical Gold Shares ETF (ARCA: SGOL)
?? - Total Assets: US$3,177.57 million
?? - Objective: Reflect the performance of the gold bullion price, minus operating expenses.
?? - Trading: Shares trade on exchanges like other securities and can be created or redeemed based on supply and demand.
?? - Gold Storage: Held in Zurich, Switzerland, adhering to London Bullion Market Association rules.
5. iShares Gold Trust Micro (ARCA: IAUM)
?? - Total Assets: US$1,168.65 million
?? - Expense Ratio: 0.09%
?? - Purpose: Designed to provide exposure to the day-to-day movement of gold bullion prices.
?? - Composition: Underlying gold bars held in vaults.
?? - Tax Consideration: IAUM is considered a collectible, so investors should be aware of significant tax liabilities for long-term gains.
These ETFs offer various options for investors seeking exposure to gold, each with its own advantages and considerations. Remember to assess your investment goals, risk tolerance, and tax implications before making any investment decisions.
Conclusion:
Gold ETFs offer investors a convenient and cost-effective way to gain exposure to the gold market, providing liquidity and diversification benefits. The five largest gold ETFs in 2024 demonstrate a variety of features and investment objectives, catering to different investor preferences and risk tolerances. Whether investors prioritize low expense ratios, physical bullion holdings, or specific tax considerations, there are options available to suit their needs. By carefully assessing their investment goals and conducting thorough research, investors can effectively incorporate gold ETFs into their portfolios to enhance diversification and potentially mitigate risk.
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