ETF Trends publisher Tom Lydon discussed the U.S. Global Go Gold and Precious Metals Miners ETF (GOAU) on this week’s “ETF of the Week” podcast with Chuck Jaffe on the MoneyLife Show.
Strong economic growth has historically been positive for gold demand. As incomes rise, demand for gold jewellery and gold-containing technology, such as smartphones and tablets, rises. Income growth also spurs savings, helping increase demand for gold bars and coins.
While the Federal Reserve is still likely to maintain its interest rate hike schedule, rising rates did not overly affect gold performance. The current cycle of interest rate normalization that started back in December 2015 has done nothing to hurt investment demand for gold.
GOAU is a smart beta offering that tracks a specialized or rules-based index to help hone in on quality players in the gold mining space.
The underlying U.S. Global GO GOLD and Precious Metal Miners Index uses quantitative analysis to pick stocks, with a particular focus on royalty companies.