Gold Hits $4,000 per Ounce. Here Are 3 Top Gold ETFs to Buy Now.
The Motley Fool·2025-10-09 08:49

Core Insights - Gold prices have surged, surpassing $4,000 per ounce on October 6, with a year-to-date increase of 51%, significantly outpacing the S&P 500's 15.3% gain [1] - Over the past two years, gold has risen by 116%, compared to a 60% gain in the S&P 500, indicating strong demand for gold as an investment [2] Factors Driving Gold Prices - Central banks are diversifying their reserves by increasing gold holdings to reduce reliance on the U.S. dollar, which is weakening against other currencies [3][4] - Retail investors are also contributing to the demand for gold, with increased purchases of gold ETFs and jewelry [6] - The technology sector is driving additional demand for gold due to its applications in high-performance semiconductors, particularly in AI [7] Investment Opportunities in Gold ETFs - Recommended gold ETFs include SPDR Gold Shares (GLD) and iShares Gold Trust (IAU), which hold significant amounts of physical gold [10] - The combined net asset value of these ETFs exceeds $183 billion, highlighting the role of retail investors in the gold market [11] - Expense ratios for these ETFs are relatively low, with SPDR Gold Shares at 0.4% and iShares Gold Trust at 0.25%, making them attractive for investors seeking liquidity and security [12] Gold Mining ETFs - The VanEck Gold Miners ETF (GDX) has seen a remarkable 127% increase year-to-date, although it underperformed gold and the S&P 500 last year [13] - Investing in gold mining ETFs spreads risk across various companies and regions, with only 17.6% of assets in U.S. gold miners [15] - The VanEck Gold Miners ETF offers an annual dividend, which may appeal to investors looking for income [16] Long-term Outlook and Strategy - Given the strong demand from central banks and retail investors, gold prices may continue to rise in the long term [17] - Investors are advised to approach gold investments cautiously, considering their preferred method of investment (physical, digital, or mining) and to build positions gradually [18]