How to Choose the Right Gold ETF

Gold has been used as a medium of exchange for thousands of years. Gold’s value to global societies helped it persist and grow over time. That value has proved durable for multiple reasons:

• Gold’s global appeal sidesteps many country-specific risks.
• Gold can’t go bankrupt or default.
• Gold operates as a store of value parked outside of traditional asset classes like stocks, bonds, or foreign exchange, and it marches to the beat of its own drum.

Despite its durability, gold is not a productive asset. Its scarcity fuels long-term returns.

Investors include gold exchange-traded funds in portfolios for a variety of reasons. It can:

• Diversify portfolios
• Hedge against weakening currencies
• Hedge inflation risks—but not always
• Provide a safe haven from global volatility

Or investors may simply buy a gold exchange-traded fund to speculate that its price will go up.

Assessing the Largest Gold ETFs

Gold ETFs have played an expanding role in how investors access gold.

SPDR Gold Shares GLD was the first one on the market, an advantage that still benefits the ETF today. Since launching in 2004, it has grown to over $174 billion in net assets.

Gold ETFs as a whole have jumped to $309 billion after strong interest and performance over the past year.

Flows into gold ETFs often accumulate during highly volatile markets, like during the global financial crisis in 2008, the initial coronavirus pandemic in 2020, and when tariffs threw a wrench into global trade in 2025. Likewise, investors often shed gold from their portfolios once those risks recede. Gold is a speculative asset that produces no income of its own, so these flows tend to dictate price moves.

Through January 2026, eight gold ETFs had more than $1 billion in assets under management. SPDR Gold Shares has topped that list since its inception. IShares Gold Trust IAU launched a couple of months after SPDR Gold Shares and holds firm control over second place with $80 billion in assets. But being second to market has kept it playing catch-up to SPDR Gold Shares for over 18 years.

All eight ETFs are structured as grantor trusts and hold physical gold. Worth noting: The Internal Revenue Service treats physical gold as “collectibles,” meaning long-term capital gains are taxed at a maximum rate of 28% instead of the 20% used for stocks and bonds.

How to Evaluate Gold ETFs

Investors interested in gold ETFs may struggle to differentiate between these eight funds. Investors get the same thing from each ETF: Gold is gold. And that gold just sits in a vault.

What differentiates these ETFs is the cost of owning them. Those costs are expressed in two ways:

Fees

These ETFs hold the same thing, so cutting fees adds directly to performance. All else equal, the one with the lowest fee will win in the long run.

Trading Costs

(Note that costs can add up with frequent trading and larger orders that may execute outside the best bid or offer. This is not typically the case for buy-and-hold investors.)

Trading costs are more complicated than fees. They vary depending on the type of investor. Buy-and-hold investors who trade infrequently are far less exposed to trading costs than a daily trader. For the market makers and proprietary trading firms trading millions of dollars’ worth of gold ETFs each day, trading costs add up quickly.

While SPDR Gold Shares comes with the highest annual fee, it reigns supreme in terms of trading costs. Over the three months through Sept. 30, 2025, the ratio between SPDR Gold Shares’ daily average bid-ask spread to its price was 0.006%, making the price of crossing the bid-ask spread in SPDR Gold Shares virtually nothing. IShares Gold Trust and SPDR Gold MiniShares GLDM were next closest with about twice as wide a spread on average. GraniteShares Gold Trust BAR clocked in with the highest spread/price ratio of 0.033%, or about 5 times higher than SPDR Gold Shares.

In theory, fair value exists somewhere in the middle of a given bid-ask spread. Investors could expect the fair value to be its midpoint. The trading cost incurred by an investor buying GraniteShares Gold Trust, for example, would be 0.033% divided by 2, or 0.0165%, since that is the price paid over fair value to cross the spread.

An investor trading once a year would happily eat 0.0165% in trading costs to save 0.23 basis points in fees from buying SPDR Gold Shares instead. But traders who buy and sell gold ETFs daily benefit from lower trading costs more than a lower annual fee. So, SPDR Gold Shares is the cheapest ETF for traders.

The other cost consideration when trading ETFs is the liquidity pool that an investor can execute. I previously assumed crossing the spread would result in a fully executed order at that single price, but that may not be the case when placing an order for a substantial number of shares. Still, paying more in trading costs for lower-cost ETFs is worthwhile for buy-and-hold investors (assuming they follow best trading practices), given the annual fee advantage.

The Verdict: What’s the Best Gold ETF?

SPDR Gold MiniShares combines a low fee and low trading costs, which makes it the best choice for most investors. Traders and those trading substantial volumes may need to take a closer look at the liquidity benefits of ETFs like SPDR Gold Shares and iShares Gold Trust to see whether they offset their higher fees.