Investors pay a premium for this particular gold ETF. It has a higher spending ratio compared to other ETFs that hold physical gold bars. However, it's still relatively cheaper than the cost of shipping, insuring and storing gold ingots and coins, especially when you consider their liquidity. Its large size makes it a favorite of institutional investors, such as pension funds, who use it to protect against inflation and other risk factors.
As with other types of ETFs, the issuing company buys shares in gold-related companies or buys and stores gold ingots on its own. Overall, these five main shares represent more than 46% of the assets of this gold ETF, led by Newmont, with more than 15%. Gold miners can use the cash flow they earn from gold production to expand their production, make dividend payments and buy back shares. Some gold ETFs directly track the price of gold, while others invest in companies in the gold mining industry.
ETF issuers are ranked based on the 3-month AUM weighted average return on their ETFs with exposure to gold. Gold ETFs are exchange-traded funds that expose investors to gold without having to directly buy, store and resell the precious metal. ETF issuers are ranked based on the total assets under management (AUM) of their ETFs exposed to gold. Gold and all other commodities are ranked based on their average 3-month return weighted by the AUM for the entire United States.
This gold ETF offers the same direct exposure to the price of gold, since it also has gold ingots, but at a lower cost. This is because it focuses on smaller mining companies, known as junior gold miners, some of which are still companies in the exploration phase. ETF issuers are ranked based on the 3-month aggregated fund flows of their ETFs with exposure to gold. Those investments and shareholder returns allow gold mining companies to potentially offer better total returns compared to gains in the price of gold.
The table below includes the ESG scores and other descriptive information for all gold ETFs listed in U. They created this ETF for cost-conscious retail investors, so that they wouldn't lose market share to rivals such as iShares Gold Trust. They chose to create a new ETF instead of changing their successful (and lucrative) SPDR Gold Shares product, preferred by institutional investors.