Gold ETFs
0 stocks · Updated Mar 25, 2026
Gold ETFs provide liquid, storage-free exposure to gold bullion — the world's oldest store of value and a classic portfolio hedge against currency debasement, inflation, and geopolitical risk. GLD (SPDR Gold Shares) and IAU (iShares Gold Trust) together hold hundreds of billions of dollars in physical gold in allocated vaults. Gold ETFs have made gold investing accessible to all investors without the challenges of physical ownership.
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Frequently Asked Questions
What is the difference between GLD and IAU?
Both GLD and IAU hold physical gold allocated in secure vaults. The key difference is cost: GLD charges 0.40% per year while IAU charges 0.25%. For long-term holders, IAU's lower expense ratio meaningfully reduces cost drag. GLD has higher daily trading volume for large-position traders.
Is gold ETF ownership as good as holding physical gold?
Gold ETFs hold allocated physical gold in regulated vaults. However, pure gold bug investors prefer physical because ETF ownership involves counterparty risk from the fund sponsor, custody risk, and annual fees that erode bullion ownership over decades.
How does gold perform during market crises?
Gold has historically served as a crisis hedge — rising during equity market stress events when investors flee to safety. The 2008 financial crisis, COVID crash (briefly), and geopolitical crises have typically benefited gold. However, in severe liquidity crises, even gold can be sold to meet margin calls.
Should gold be a permanent part of a portfolio?
Many professional portfolio managers allocate 5-10% to gold as a permanent portfolio ballast, citing its low correlation to stocks and bonds and its hedge against tail risks. Gold pays no income (a cost), so excessive gold allocation drags long-term returns.