The price of gold set a record high in Australian dollars on October 30 as its momentum carried the Australian dollar gold price to an all-time high of AU$4,253.48 per ounce.
After first crossing the US$2,700 mark last month following a prolonged period of strength for the gold price, it pulled back following news in early November that Donald Trump had won the US presidential election, which sent the US dollar higher and pushed investors away from gold and into bonds.
While gold briefly bounced back following a 25 point interest rate cut at the US Federal Reserve's most recent meeting on November 6 and 7, it fell back towards US$2,600 — and below AU$4,000 — at the beginning of the following week. As for the Reserve Bank of Australia, it decided to once again hold interest rates at 4.35 percent on November 5.
For many investors, gold is a tool for diversification. The precious metal is known for its ability to act as a safe haven and hence operates as a protective option when building a balanced portfolio.
Gold exchange-traded funds (ETFs) give investors a relatively easy way to get exposure to physical gold without having to worry about the extra hassle of buying and storing the metal — not to mention insuring it. Gold ETFs can also track a basket of gold-focused stocks, allowing investors to spread risk instead of betting on individual companies.
Below the Investing News Network has listed the five ASX gold ETFs and exchange-traded products (ETPs) that provide exposure to physical gold, and the two ASX gold ETFs that offer exposure to gold companies. The ETFs are listed by assets under management, and data was retrieved from each company’s website on November 7, 2024.
1. Global X Physical Gold (ASX:GOLD)
Total assets under management: AU$3.73 billion
Unit price: AU$37.26
Previously known as ETFS Physical Gold, Global X Physical Gold is an ETP that promises a "low-cost and secure way to access physical gold via the stock exchange," while avoiding the struggle of storage.
The entity is backed by gold held in a London vault by JPMorgan Chase (NYSE:JPM). Investors can redeem shares for physical gold, not just the cash equivalent; however, this comes with a fee of AU$1,000 per redemption. Global X's website suggests that for smaller orders, a more cost-effective option is selling units on the secondary market.
This ETP has a management fee of 0.4 percent.
2. Perth Mint Gold (ASX:PMGOLD)
Total assets under management: AU$1.01 billion
Unit price: AU$39.98
Owned by the Western Australian government, Perth Mint Gold is an ETP that tracks the international price of gold in Australian dollars. Investments are backed by gold bullion stored in the Perth Mint. Perth Mint Gold is the only gold product on the ASX that maintains a government guarantee for holdings.
This ETF has a management fee of just 0.15 percent, making it the lowest-cost physical gold ETF on the ASX.
3. BetaShares Gold Bullion ETF (ASX:QAU)
Total assets under management: AU$711.16 million
Unit price: AU$22.94
The BetaShares Gold Bullion ETF tracks the price of physical gold. It is backed by gold bullion stored by JPMorgan Chase in London. Although the ETF is based on physical gold, you do not own physical gold by owning the ETF. Rather, when you sell shares of your ETF, you receive the cash equivalent of the gold.
This ETF has a management fee of 0.59 percent.
4. VanEck Gold Miners ETF (ASX:GDX)
Total assets under management: AU$585.88 million
Unit price: AU$59.10
The VanEck Gold Miners ETF provides investors with exposure to the largest global gold producers and royalty companies involved in the precious metals space. Its top holdings include Newmont (NYSE:NEM,TSX:NGT), Agnico Eagle Mines (NYSE:AEM,TSX:AEM) and Barrick Gold (NYSE:GOLD,TSX:ABX).
This ETF also offers exposure to Australian gold miners, with just over 10 percent of its holdings allocated to Australian gold operators, including Northern Star Resources (ASX:NST,OTC Pink:NESRF).
GDX provides a yearly dividend, currently set at 1.65 percent. The ETF has a management fee of 0.53 percent.
5. iShares Physical Gold ETF (ASX:GLDN)
Total assets under management: AU$189.63 million
Unit price: AU$32.25
Established in October 2023, iShares Physical Gold ETF was designed to provide investors with exposure to the spot price of gold without the need for physical storage of personal gold holdings.
Like many gold-based ETFs, this product is considered high risk and is intended for investors who are looking to maintain their investment for more than five years. Since its inception, GLDN has benefitted from the relative strength in thegold marketand has provided investors with an 18 percent return.
iShares Physical Gold ETF's management fees are among the lowest on this list at 0.18 percent.
6. Betashares Global Gold Miners ETF (ASX:MNRS)
Total assets under management: AU$85.87 million
Unit price: AU$6.80
The Betashares Global Gold Miners ETF allows Australian investors to add a diverse range of global companies in the gold mining space to their portfolio by focusing on the biggest ex-Australia precious metals companies.
Its top holdings include Newmont, Barrick, Agnico Eagle and royalty company Wheaton Precious Metals (NYSE:WPM,TSX:WPM).
This ETF has a management fee of 0.57 percent.
7. VanEck Gold Bullion ETF (ASX:NUGG)
Total assets under management: AU$77.06 million
Unit price: AU$40.24
Established in December 2022, the VanEck Gold Bullion ETF allows investors exposure to thegold marketwithout the need to purchase physical gold. It is backed by physical gold bullion bars sourced from Australian gold producers.
This ETF has a management fee of 0.25 percent and since its inception has returned 21.36 percent.
Don't forget to follow us @INN_Australia for real-time news updates!
Securities Disclosure: I, Dean Belder, hold no direct investment interest in any company mentioned in this article.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
