Last year was a dismal one for commodities exchange traded funds, both from a performance and outflows perspective.
Although it fell just 2.2% for the year, the SPDR Gold Shares (NYSEArca: GLD), iShares Gold Trust (NYSEArca: IAU) and the ETFS Physical Swiss Gold Shares (NYSEArca: SGOL) each lost more than 2%. Frustrated by a lack of inflation and spurred by a soaring U.S. dollar, investors pulled $3.2 billion from GLD. That placed the world’s largest gold ETF on the 2014 top 10 list for largest outflows and now GLD is no longer among the ten largest ETFs. [Gold ETFs Want 2014 to End]
Gold and gold ETFs were not alone in their suffering. On a global basis, combined assets under management for commodities exchange traded products fell by $20.6 billion to $101.5 billion “as a strong US dollar and concerns about China and Europe growth knocked many commodity prices down towards their production costs,” according to ETF Securities.
Precious metals ETFs accounted for 70% of the asset departures from commodities ETFs last year, but there were exceptions to that rule. For example, on a global basis, palladium ETFs added $900 million in new assets, but in the U.S. investors pulled ETFS Physical Palladium Shares (NYSEArca: PALL).
Departures from PALL proved hasty because the fund’s 11.3% gain easily made it the best performing physically-backed precious metals in the U.S. last year. [Best and Worst Precious Metals ETFs]
Despite declines of nearly 20%, investors remained loyal to silver ETFs as the iShares Silver Trust (NYSEArca: SLV) and the ETFS Physical Silver Shares (NYSEArca: SIVR) saw 2014 inflows of $241.6 million and $15.3 million, respectively.