For investors looking to hedge their bets against an unpredictable economy, gold exchange-traded funds can be a more manageable and cheaper way to invest in the commodity.

Gold prices are currently hovering around an all-time high, and some ETFs could help investors cash in on the hot market.

Key things

  • Gold prices hover around historic highs.
  • The iShares Gold Micro ETF has the lowest expense ratio. Invesco DB Precious Metals Fund has the best annual performance. And the SPDR Gold Trust offers traders the best liquidity.
  • The holdings of these ETFs are represented by gold bullion and precious metal futures.

There are about 10 gold-focused ETFs traded in the U.S., excluding leverage effect and inverse funds, even those with less than $50 million managed assets (AUM). They invest directly in gold precious metals or gold futures contracts as opposed to the companies that mine the metal.

Gold prices are hovering around an all-time high reached in May of more than $2,000 an ounce.

Below, we look at the three gold ETFs with the lowest fees, best 12-month returns and the most liquidity. We ruled it out leveraged ETFs, which provide excess returns but bring additional risk. All data below is as of June 14.

  • Performance in one year: 7.51%
  • Expense ratio: 0.09%
  • Annual Dividend Yield: N/A
  • 30-day average daily volume: 494,889
  • Assets under management: $993.4 million
  • Start date: June 15, 2021
  • Issuer: BlackRock Financial Management

Unlike many other gold exchange-traded products, IAUM is structured like a true ETF. It is traded on NYSE Arca and also uses the LBMA gold price as a benchmark. IAUM can be used as a way to diversify a portfolio of securities and protect against inflation. The sole owner of IAUM is gold bullion.

  • Performance in one year: 7.54%
  • Expense ratio: 0.77%
  • Annual dividend yield: 0.43%
  • Three-month average daily volume: 27,844
  • Assets under management: $181.1 million
  • Start date: January 5, 2007
  • Issuer: Invesco

The Invesco DB Precious Metals Fund tracks the DBIQ Optimum Yield Precious Metals Index. This fund is aimed at investors who want to invest in commodity futures. 80% of funds held are gold futures; the remaining 20% ​​is silver futures.

  • Performance in one year: 7.16%
  • Expense ratio: 0.40%
  • Annual Dividend Yield: N/A
  • Three-month average daily volume: 8,654,929
  • Assets under management: $58.5 billion
  • Start date: November 18, 2004
  • Issuer: World Gold Trust Services

The SPDR Gold Trust tracks the LBMA gold price as a benchmark. The objective of this fund is to mirror the price of gold bullion. It is the most popular and oldest trading gold ETF in the US market.

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As of this writing, the author does not own any of the ETFs listed above.

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