5 Gold ETF Options to consider
Gold has been offering good returns over the investment for a long time. The investors who are thinking about buying this treasured metal in papers consider ETFs (exchange-traded funds) as a prodigious way of investing in gold. These funds are handled by the experts in gold and you get a chance of winning better money than any other option. The gold price at a particular time would always affect the gold ETFs.
We have chosen five gold ETFs on the basis of their net assets. These funds don’t pay off a dividend and include different expenses.
- SPDR Gold Shares (GLD)
This fund includes the purchase of gold bullion due to which its price is very sensitive to the gold rates and follow the changing trends closely. The share of GLD represents more gold than the other funds which don’t include the buying of physical gold. No one can loan or borrow the gold bars and this is the major benefit of holding the gold stocks. Internal Revenue Service considers gold as a collectible entity with higher prospects of long-term profits.
- GraniteShares Gold Trust (BAR)
The GraniteShares Gold Trust seeks the performance on the gold prices. It is a new ETF which will be one-year-old on August 31 this year. There are fewer trust expenses committed with this ETF. This ETF has achieved the net asset of $14.3 million in a years’ time.
- Physical Swiss Gold (SGOL)
SGOL makes the storage of gold in a Zurich vault. The shareholders are the owners of the portion of that gold. The fund is highly liquid and it is feasible to buy or sell the shares with ease. There is a probability to take profits efficiently and add the shares while making a decision to buy the dips. The major difference between SGOL and other ETFs is that the gold is exclusively warehoused in the Switzerland vaults for SGOL.
- iShares Gold Trust (IAU)
This ETF also aims at buying a physical form of gold. The fund includes the insurance, transport and warehouse expenses for gold. The vaults of IAU are located in various global locations. The fund managers consider the buying of gold as a long-term investment and hold the gold bullion rather than selling it when the prices go up. It is a stable fund and includes low expenses in comparison to the other options. One share of the fund equals to the 1/100th value of an ounce of old. The returns of this ETF in 2017 was 12.91%.
- PowerShares DB Gold ETF (DGL)
DGL doesn’t buy gold but instead has a focus on buying the future contracts. The investors get a K-1 form during tax season and pay taxes as the partners of the company. Additionally, the fund managers need to fight contango which is a situation where the futuristic contract is more than the future spot gold price. Investors lose money as the futures contract need to be adjusted in a way to match the spot price. The net assets of the ETF are $200.02 million which is on the higher side in comparison to other ETFs.
Gold is a speculative form of investment and ETFs are considered to be less risky than making other gold-related investments. For the direct investments in gold, the profits and losses are directly dependent on the gold price.