3 Best Gold ETFs To Buy Now for 2023

Gold bars sitting in front of bar graph.
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Much like a dragon in folklore, it is time to think about gold. This precious metal has been a form of currency since the ancient kings of Egypt made it the first medium of exchange. There are many ways to invest in gold but is it still worth it? One thing to consider is investing in gold EFTs.

Read: 3 Things You Must Do When Your Savings Reach $50,000

What Is a Gold ETF?

Gold exchange-traded funds, or ETFs, allow you to invest in gold-backed assets as opposed to a physical commodity. These options tend to be more diversified and lower cost. So though you trade these like stocks, as an investor, you don’t own the physical commodity.

Gold prices often go up as stock prices go down so they are typically considered a safe haven investment with a more stable net asset value or NAV. As physical prices for gold soar, thanks to inflation, many seasoned investors are turning to gold ETFs.

3 Best Gold ETFs To Invest In

If you do want to gain exposure to the asset class without having to invest as much money, explore investing in these gold ETFs.

  1. iShares Gold Trust Micro (IAUM)
  2. VanEck Merk Gold Trust (OUNZ)
  3. Goldman Sachs Physical Gold (AAAU)
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1. iShares Gold Trust Micro (IAUM)

Current NAV: $18.70

IAUM is one of the lower-cost gold ETFs on the market for physical gold. With this investment, you gain exposure to the daily movement and pricing of gold bullion. This is a good way to protect yourself against inflation and diversify your portfolio. As this investment company is not registered under the Investment Company Act of 1940, you should be aware it is not subject to the same regulations as mutual funds or other ETFs.

2. VanEck Merk Gold Trust (OUNZ)

Current NAV: $18.14

OUNZ has its gold bullion assets in the form of allocated London Bars. It also allows investors the opportunity to exchange their shares for physical gold bullion delivery. To help streamline this delivery system, the company converts London Bars into denominations that may work for customers in other forms such as gold coins.

If you do opt to take the gold delivery, you cannot be taxed as you are merely taking possession of something you already own. It is a gold ETF, but with the option to exchange for physical gold which is something to consider.

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3. Goldman Sachs Physical Gold (AAAU)

Current NAV: $18.58

AAAU intends to provide investors the chance to invest in gold through shares. These shares reflect the performance of the price of gold less the expenses of the trust’s operations. 

It holds gold assets in the form of London Bars and physical gold of other specifications. As an investor, you can exchange your surrendered basket for physical gold.

Are Gold ETFs a Good Investment?

There is never an investment that doesn’t come without risks, but investing in gold or gold ETFs are considered by some experts to be a safe haven investment. This is because, during times of economic instability, the value of gold tends to increase as stock market prices take a tumble. Gold ETFs are a way to invest in gold without the high price point as you would be investing in gold-backed assets as opposed to physical gold.

There are even new ways to invest in gold ETFs such as Strategy Shares Gold-Hedged Bond (GLDB). This is the only fund that pays monthly distributions from bonds while also tracking the price of gold. By doing this as well as investing in a total refund swap contract it can pay a compelling yield.

Final Take

Everything that glitters may not be gold, but investing in gold ETFs may provide stability in an unstable economy. Gold ETFs, and investing in them, may not be without risks but they are a less expensive option to invest in this highly valued precious metal. It may be a better choice for you to invest in rather than gold bullion itself.

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FAQ

Here are the answers to some commonly asked questions about gold ETFs.
  • What is the best ETF for gold?
    • There are many options to invest in gold ETFs, here are some top performers:
      • iShares Gold Trust Micro (IAUM)
      • VanEck Merk Gold Trust (OUNZ)
      • Goldman Sachs Physical Gold (AAAU)
  • Is a gold ETF a good investment?
    • Investing in gold ETFs can be a viable option as gold prices often go up as stock prices go down so they are typically considered a safe haven investment.
  • Is a gold ETF as good as physical gold?
    • A gold ETF allows you to invest in gold-backed assets, but not the physical commodity of gold. This is a less expensive option, but not necessarily the same thing. There are gold ETFs such as VanEck Merk Gold Trust (OUNZ) or Goldman Sachs Physical Gold (AAAU) which allow investors to exchange shares for physical gold.
  • What is a gold ETF?
    • Gold ETF is an exchange-traded fund that attempts to track the domestic price of physical gold. As passive investment instruments, they are based on gold prices and invest in assets backed by gold bullion but not the physical commodity itself. Gold prices often go up as stock prices go down so they are typically considered a safer investment with a more stable net asset value.
  • What is meant by gold ETF?
    • Gold exchange-traded funds, or ETFs, allow you to invest in gold-backed assets as opposed to a physical commodity. These options tend to be more diversified and lower cost. So though you trade these like stocks, as an investor, you don't own the physical commodity.

Data is accurate as of Jan. 12, 2023, and is subject to change.

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About the Author

Caitlyn Moorhead has written content for a variety of businesses and publications. After graduating from Central Michigan University cum laude, she moved to New York City where she wrote columns, articles and plays for several years before relocating to Austin, Texas in the fall of 2020.
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