Investors have turned to GLD as a quick and easy way to gain exposure to gold price movements as they hedge against market risks, help protect their purchasing power in times of inflationary pressures or capitalize on increasing demand from the emerging markets with a growing middle-income class.
A Gold ETF With Cheap Exposure
The World Gold Council and State Street Global Advisors expanded on the gold ETF theme with the launch of a new offering that provides the cheapest exposure along with a low share price to those investors seeking exposure to the yellow precious metal. The SPDR Gold MiniShares Trust (NYSEArca: GLDM) has a 0.18% expense ratio and was initially listed at a per-share trading price of 1/100th of an ounce of gold, as represented by the LBMA Gold Price PM (USD).
The new gold fund’s strategy is identical to GLD – both are physically backed by gold bullion and are structured as grantor trusts. However, GLD’s price was 1/10th the price of gold in ounces at its inception while the new Gold MiniShares ETF was priced at 1/100th the price of gold in ounces.
Additionally, while the U.S. dollar strengthens, investors may still capture the potential upside in gold or hedge against potential market risks without worrying about an appreciating USD through the SPDR Long Dollar Gold Trust (NYSEArca: GLDW). The dollar-hedged gold ETF may help investors gain exposure to gold bullion price movements and limit the negative effects of potential market volatility, without worrying about a stronger U.S. dollar.
Financial advisors who are interested in learning more about the gold market can register for the Tuesday, October 2 webcast here.