Home News Best Precious Metals ETFs for Q4 2022

Best Precious Metals ETFs for Q4 2022

by SuperiorInvest

Precious metal like gold, silver and platinum are valued by many investors as a Hedge against inflation or a a safe haven in times of economic turbulence. They are also valued for their rarity and use in a wide variety of industrial applications.

Precious metal exchange traded funds (ETFs) are a popular way to invest in these metals, either through physical exposure or exposure based on futures. ETFs can offer a more liquid and simpler approach to investing in precious metals than buying futures contractspurchase precious metalsor purchasing shares in publicly traded companies engaged in the exploration or production of these metals.

Key things

  • The precious metals market has lagged behind the broad US stock market over the past year.
  • The precious metals exchange-traded funds (ETFs) with the best annual total returns are IAUM, GLDM and SGOL.
  • The sole holding in each of these ETFs is gold.

There are 15 ETFs that trade in the US, excluding inverse and leverage effect ETFs as well as funds with less than $50 million assets under management (AUM). These ETFs are invested in physical precious metals rather than shares of precious metal mining companies. The benchmark The S&P GSCI Precious Metals Index has underperformed the broader US stock market over the past 12 months, delivering a total return of -3.5% compared to a total return of -2.5% for the S&P 500 as of August 17, 2022. The best-performing precious metals ETF, based on performance over the past year, is the iShares Gold Trust Micro ETF (IAM).

Below, we examine the three best ETFs for precious metals. All figures are as of August 18, 2022. In order to focus on the funds’ investment strategy, the best holdings listed for each ETF exclude cash holdings and holdings purchased with securities lending proceeds, except in unusual cases, such as when the cash portion is exceptionally large.

  • Performance in one year: -1.5%
  • Expense ratio: 0.15%
  • Annual Dividend Yield: N/A
  • Three-month average daily volume: 85,547
  • Assets under management: $1.1 billion
  • Start date: June 15, 2021
  • Issuer: BlackRock Financial Management

IAUM tracks the gold price of the London Bullion Market Association (LBMA) and provides exposure to daily gold price movements. ETF gold bars are stored in vaults. Because IAUM is considered a collectibleinvestors should be aware that any long-term gains will have significant tax liabilities. The sole owner of IAUM is gold bullion.

  • Performance in one year: -1.6%
  • Expense ratio: 0.10%
  • Annual Dividend Yield: N/A
  • Three-month average daily volume: 1,733,950
  • Assets under management: $5.2 billion
  • Start date: June 25, 2018
  • Issuer: World Gold Council

GLDM aims to reflect the performance of the gold price minus the fund’s expenses. The ETF is structured as a trust fund, which can provide investors with a degree of tax protection. GLDM has a lower expense ratio than many other alternative precious metals commodity ETFs. Like IAUM, GLDM tracks the London Bullion Market Association (LBMA) gold price as a benchmark. It provides investors with a cost-effective and convenient way to invest in gold. The sole owner of the fund is gold bullion.

  • Performance in one year: -1.6%
  • Expense ratio: 0.17%
  • Annual Dividend Yield: N/A
  • Three-month average daily volume: 1,095,450
  • Assets under management: $2.4 billion
  • Start date: September 9, 2009
  • Issuer: Abrdn PLC

SGOL is structured as a mutual fund that seeks to track the performance of the gold bullion price minus the fund’s expenses. While the ETF is more expensive than GLDM and IAUM have a lower expense ratio, SGOL is still lower than many other precious metals ETFs. The fund’s only holdings are gold bars, which are kept in vaults in London and Zurich. The leading auditor of physical commodities, Inspectorate International, inspects SGOL’s vaults twice a year.

The comments, opinions and analysis expressed herein are for informational purposes only and should not be construed as individual investment advice or recommendations to invest in any security or adopt any investment strategy. While we believe the information contained herein to be reliable, we do not guarantee its accuracy or completeness. The opinions and strategies described in our content may not be suitable for all investors. Because market and economic conditions are subject to rapid change, all comments, opinions and analysis contained in our content are provided as of the date of publication and are subject to change without notice. The material is not intended to be a complete analysis of all material facts relating to any country, region, market, industry, investment or strategy.

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