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Best gold ETFs to buy in 2022
This article delves into the investment proposition that is gold exchange-traded funds, also known as ETFs. This page explains everything you need to know and uncovers your best options, providing a breakdown for each ETF.
What are the top gold ETFs to buy?
Simply consult the table below for our top 5. Given the long-standing popularity of gold as an investable commodity, there are many ETFs of this type. Our team of experienced analysts have been hard at work choosing the best ones, and you can find out about their latest price information by clicking a relevant link in the table. Otherwise, scroll down to learn more about each one.
|#||ETF ticker||ETF name|
|1||AAAU||Goldman Sachs Physical Gold ETF|
|2||SGOL||Aberdeen Standard Physical Gold Shares ETF|
|3||RING||iShares MSCI Global Gold Miners ETF|
|4||SGDJ||Sprott Junior Gold Miners ETF|
|5||GDXJ||VanEck Vectors Junior Gold Miners ETF|
1. Goldman Sachs Physical Gold ETF (NYSEARCA: AAAU)
Acquired by major investment bank Goldman Sachs on December 4th 2020, and formerly known as Perth Mint Physical Gold ETF, the Goldman Sachs Physical Gold ETF aims to provide investors with exposure to the price of gold without the inconvenience of physical gold ownership or fund expenses.
The sole asset that is owned by AAAU is gold bullion, which is stored in vaults in London, UK. The fund has performed well in recent years, and a key feature that differentiates it from other ETFs is that investors may, at any time, choose to trade their shares in for physical gold of a guaranteed purity.
3. Aberdeen Standard Physical Gold Shares ETF (NYSEARCA: SGOL)
Much like AAAU, SGOL is designed to offer quick and hassle-free exposure to the price of gold bullion without the need for physical ownership. The ETF is backed by gold stored in vaults in Zurich, Switzerland and London, UK. Its custodian is J.P. Morgan Chase Bank, and its trustee is The Bank of New York Mellon.
With over $2 billion in net assets, it is one of the largest gold ETFs in the world, and with some of the most respected institutional names operating it, SGOL is one of the most popular and trusted ETFs around. Its market performance largely mirrors the price of gold, and as a result, it has performed well in the last 5 years.
3. iShares MSCI Global Gold Miners ETF (NASDAQ: RING)
RING offers exposure to an index featuring the market performance of companies that primarily generate revenue from gold mining operations. The fund targets 40 of the best gold mining stocks around such as Barrick Gold (around 15%), Wheaton Precious Metals Corp. (around 8%) and Kirkland Lake Gold (around 5%). These companies are spread around the world to diversify jurisdictional risk and allow investors to speculate on the global gold mining sector.
If you are unsure about assembling your own portfolio of individual gold stocks, RING offers a selection of some of the best with a small management fee of around 0.40%.
4. Sprott Junior Gold Miners ETF (NYSEARCA: SGDJ)
Founded on March 31st 2015 by Sprott Inc, SGDJ is a specialised gold mining ETF with over $100 million in assets.
Its primary focus is on large- and mid-sized gold producers with the strongest revenue growth and exploration companies with the strongest stock price momentum. This means SGDJ is a more speculative ETF than most, and it offers investors exposure to some higher-risk companies with the potential for larger rewards down the line. Most of the ETF’s holdings are stored in Australia or Canada.
The strategy for SGDJ is a hybrid approach, with a balance of growth and value stocks. Consequently, the fund’s top three holdings are K92 Mining Inc, Skeena Resources Ltd, and Wesdome Gold Mines Ltd. While SGDJ has not performed particularly well in the last 5 years, the central premise of this ETF makes sense and long-term price growth seems realistic.
5. VanEck Vectors Junior Gold Miners ETF (LON: GDXJ)
GDJX is an ETF that is intended to closely track the performance of the Market Vectors Global Junior Gold Miners Index (MVGDXJTR). It has a market cap of around $2 billion in size, and normally invests around 80% of its total assets in securities that comprise the MVGDXJTR.
All of the 90-or-so companies included in the GDXJ ETF generate or have the potential to generate at least 50% of their revenues from gold and/or silver mining, royalties and/or streaming. This means it is a good ETF for investors looking for a blend of established gold producers and up-and-coming developers.
Where to buy the best gold ETFs
To invest in an ETF, you need an account with an online broker. Since ETFs trade just like regular stocks, you can buy and sell them whenever you like through most brokers. All of the options below have low fees and high-quality user interfaces, so you shouldn’t be found wanting.
What is a gold ETF?
It is a fund that trades on the stock market, and it only owns stocks in companies related to the gold sector and/or gold reserves. These stocks can include gold mining companies in the form of explorers, developers and producers, in addition to royalty and streaming companies. Each ETF has its own ticker symbol, and you can find the tickers of our top 5 ETFs in the table at the top of this page.
Since ETFs are usually individual baskets of different stocks, they allow investors to gain exposure to an entire industry rather than putting all of their eggs into one basket with a single stock. Moreover, they offer added convenience since investors do not need to purchase physical gold in the form of bars, bullion and coins; instead, everything is done online.
Are gold ETFs a good investment?
If you believe the gold sector is going to perform well and the price of gold is going to rise, investing in an ETF is generally more diversified and less risky than a single stock. So, for long-term investors with a keen appreciation of the gold macro story, ETFs can offer great value that is devoid of single stock risk.
The gold sector has always been viewed as a useful investment category to hedge against inflation. Rather than leaving your money in a bank account to be diluted by potentially inflationary economic factors like quantitive easing, your capital remains in a safe haven that isn’t directly affected by broader economic activity.
As with any other investment, you need to employ time, research and planning before choosing a gold ETF. The links below can direct you to the latest information about where we are in the current gold cycle and the key factors related to the financial markets that you need to take into account.
Latest gold news
Gold price prediction ahead of US inflation data
Gold price prediction with US nonfarm payrolls data in focus
Gold price prediction: range-bound trading is likely
Gold Price Prediction After Moving Past a Psychologically Crucial Level
Gold price prediction ahead of the Fed interest rate decision
Gold price prediction: bearish formation to define direction in the short term
Fact-checking & references
Our editors fact-check all content to ensure compliance with our strict editorial policy. The information in this article is supported by the following reliable sources.
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