Here's the cheapest ETF to play gold as it flirts with $1,900
Feb. 17, 2022 10:03 AM ET Gold Spot Price (XAUUSD:CUR), SGOL, GLD, IAU By: Jason Capul, SA News Editor 16 Comments
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With gold approaching $1,900 an ounce, Aberdeen Standard Physical Gold Shares ETF (NYSEARCA: SGOL) represents the lowest-cost investment vehicle to play a potential further rise in the yellow metal.
Gold prices ( XAUUSD:CUR) rose 1.3% on Thursday to reach $1,897, just shy of the $1,900/oz mark. For investors looking to play the gold market without dabbling in direct purchase, SGOL provides exposure to the physical precious metal through an ETF.
Spot gold ETFs and traditional funds either invest in the gold futures market or purchase actual gold bullion. Moreover, when market participants look to play spot gold, most revert to the SPDR Gold Trust ETF (NYSEARCA: GLD) or iShares Gold Trust ETF (NYSEARCA: IAU).
However, SGOL offers a lower expense ratio than these better-known alternatives. Breaking down the cost structure, SGOL provides the cheapest expense ratio at 0.17%. IAU comes in second with a 0.25% expense ratio, and then finally, the powerhouse GLD, with its $61.17B assets under management, has an expense ratio of 0.40%.
Gold has now rallied 5.4% in the month of Feb., closing positive in all but three sessions this month. The commodity has also touched a fresh eight-month high as investors have gravitated toward the risk-off instrument with inflation concerns continuing to swirl around the market.
The upward push in gold has lent support for SGOL, IAU, and GLD, as they are each up 1% to start Thursday's trading session.
Year-to-date price action: SGOL +2.3%, IAU +2.3%, GLD +2.2%.
Gold continues to catch a bid this month as rising fears of a Russian invasion of Ukraine prompt demand for safe-haven assets. |
