Gold ETF stocks are listed on major exchanges like the NSE and the Bombay Stock Exchange (BSE), allowing you to buy or sell gold electronically like any other stock. Based on your risk profile, explore the market factors and options to make a mindful investment choice. You can also invest in gold mutual funds if you do not wish to buy gold ETF stocks through a demat account. Gold, in India, holds a special place in the hearts of consumers, symbolising both tradition and wealth.
It only holds gold sourced from accredited refiners that demonstrate their efforts to respect the environment and combat money laundering, terrorist financing, and human rights abuses. This responsibly sourced gold ETF has a low expense ratio of 0.15%. Investing in financial markets are subject to market risks, and past performance does not guarantee future results. It is advisable to consult a qualified financial professional, review official documents, and verify information independently before making investment decisions. Following are the best gold ETFs to buy in India after carefully taking into account the AUM, ETF performance, and expense ratios as of 20th January 2025. We have not considered the performance of any Gold ETF Fund of Funds while compiling this list.
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Gold ETFs eliminate these worries as investors do not need a locker to store the metal physically. Its 5-year CAGR stands at 13.97%, reflecting consistent performance. As of December 9, 2024, it’s trading about 7.35% below its 52-week high. The SBI Gold ETF is known for its transparency and ease of trading on stock exchanges. With a value of $75B, it is by far the most liquid gold ETF Trust, with very little difference between the price paid by an investor in GLD and gold spot price. This can actually be a lower premium than actual physical gold an investor can take delivery of in physical form, like gold bars or gold coins.
Here is an overview of who can consider investing in these funds. If you wish to invest in the best gold funds, understanding how they work is crucial. Here is a hypothetical example of how these investment products operate. In this write-up, we will take a look at the list of top 10 gold ETFs based on their AUM (assets under management) as on January 31, 2025.
- ZGD is eligible for registered and non-registered investment accounts and carries a “high” risk rating.
- A gold exchange-traded fund (ETF) is a unique investment product that tracks the price of physical gold.
- AMFI data showed gold ETFs registered the highest monthly inflow of Rs 3,751 crore in January against Rs 640 crore in December, a 6-fold rise.
- Schwab’s platform allows investors to compare gold ETF performance across different providers.
Prices of Gold ETFs are directly linked to the domestic price of Gold. Any fall in the value of Gold will directly affect the ETF price. Hence, gold ETFs can lose or gain value based on the fall and rise in gold prices. As ETFs are bought and sold on stock exchanges, liquidity is a crucial aspect. Investors should check the daily traded volume data on the stock exchanges, along with the bid-ask spread, to ensure smooth order-matching. With more than 18 ETFs tracking India’s domestic gold price, it is essential to understand how you select the right fund that will optimize the returns and, in turn, the portfolio returns.
Top gold ETFs
By far the largest gold ETF, SPDR differs from others as it does not hold stock but actual gold. The trust owns 877 tons of gold or as much gold reserve as major countries like India or Japan. Yes, depending on the provider, you can convert gold ETFs into physical gold, but only if the quantity is large enough, usually starting from 1 kg. It”s essential to check the specific ETF”s terms and conditions before converting to physical gold. As we move through 2025, the demand for gold remains strong, even as prices keep increasing.
Benefits of Investing in Gold ETFs
The SPDR Gold MiniShares Trust (GLDM) is the little brother to their massive GLD. Because of this, its expense ratio is much lower at 0.10% as of February, 2022. I wrote a more comprehensive overview of gold recently here so you may want to check that out if you want to dive into the details.
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- IShares Gold Trust charges 0.25%, while SPDR Gold Shares costs 0.40%.
- Due to its lower expense ratio and higher returns among its peers, LIC MF Gold ETF is considered the best ETF in India.
- These ETFs track gold (equity or commodity) or the inverse of gold with a certain multiple in performance.
- You don’t need to worry about how gold mining companies perform or any financial variations.
- Suppose the price of one unit of the ETF is ₹7,000, you can purchase two units.
If you want to hold one of those ‘babies’ in your hands, you can redeem your ETF unit for physical gold bullion (starting at a weight of between 350 and 430 troy ounces). ZGD tracks the Soloactive Equal Weight Global Gold Index and aims to replicate its performance (net of expenses) by investing in gold mining equities. Yet, most investing & trading platforms in India have remained more or less the same over the past decade.
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Thus, any gold mining ETF you hold will provide you exposure not just to gold prices, but the prices of other metals, too … even if it’s just incidentally. Many gold ETFs, including SPDR Gold Shares, track the price of gold because they hold physical gold. Others own shares of gold mining companies, which don’t track the price of gold. These mining companies are much smaller than most held by VanEck Vectors Gold Miners ETF.
Best Gold ETFs: Top Funds and Strategies for 2025
These funds, which track gold prices, are passive investment options that can also be freely traded on exchanges. Due to their unique structure, gold exchange-traded funds offer the advantages of liquidity, transparency and cost efficiency. Gold ETFs trade on stock exchanges and can be bought and sold continuously at market prices.
So if you’re a long-term investor, you might want to consider the next fund instead. Kevin Voigt is a freelance writer covering personal loans and investing topics for NerdWallet. He previously was a reporter with The Wall Street Journal and business producer for CNN.com in Hong Kong, where he was based for nearly two decades. Chris Hutchison helped build NerdWallet’s editorial operation and has directed coverage across banking, investing, taxes and insurance.
HDFC Gold ETF is generally considered a safe investment as it is backed by HDFC Asset Management, a reputable institution and gold being a reliable asset. However, like all investments, gold prices can be volatile and carry certain risks. A high tracking error means the fund’s return is likely to deviate more from its benchmark’s performance resulting in low returns.
Incepted in 2011, Aditya Birla Sun Life Gold ETF with its 13.68% CAGR returns over the past 5 years coupled with its competitive expense ratio makes it an attractive option for investors. The stocks, securities, and investment best gold etf instruments mentioned herein are not recommendations under SEBI (Research Analysts) Regulations, 2014. Readers are advised to conduct their own due diligence and seek independent financial advice before making any investment decisions. Investing in Gold ETFs is an intelligent way to diversify your portfolio, protect against inflation, and reduce the impact of market ups and downs.