Gold has had a strong year, to say the least; futures prices are up more than 50% in the last calendar year to more than $4,000 an ounce. They briefly surpassed $4,300 in a record-setting October. Compare that with the S&P 500’s roughly 11% gain year to date, and gold owners are sitting pretty.
Before we get into why gold prices are doing so well and how investors can get exposure through exchange-traded funds, or ETFs, it’s worth noting come cautionary items.
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The first is that over the long run, gold is viewed as a store of value, rather than a way to make a quick buck, like some growth stocks might be. Even though the precious metal is up 50% year to date, that doesn’t mean it’s typical.
Investors “should not invest in gold because they think they will double their money in a short amount of time,” says Greg Orrell, president of Orrell Capital Management, which offers the OCM Gold Fund (ticker: OCMAX).
Also, keep in mind that there are a host of factors affecting gold prices, which makes it difficult to predict where the metal is going over a shorter time frame and contributes to gold’s reputation as a volatile investment.
Still, over decades, gold prices tend to hold up well in the face of inflation, which is one of the main reasons people buy and hold it.
Why Are Gold Prices So High?
With that in mind, here’s a look at factors that have helped gold climb to its recent record-high price:
Central Bank Buying
One of the reasons regular folks buy gold is as a hedge against the decline in purchasing power of major currencies, especially the U.S. dollar.
That’s also one of the reasons central banks buy gold. These institutions, which have much more purchasing power to sway the gold market than individual investors, in the first three-quarters of the year, added 634 metric tons of gold to their reserves, according to the World Gold Council. The trade group expects central banks to buy between 750 metric tons and 950 metric tons this year.
“Central banks continue to be net buyers of gold, and that steady official demand has created a higher structural floor for prices,” says Michael Unger, vice president of investments and planning at Coral Gables Trust.
A Weakening Dollar
The U.S. Dollar Index, which measures the buck against a basket of currencies of major U.S. trading partners, is down more than 7% year to date, spurring investors to seek alternatives, which include gold.
According to Morningstar, an investment research firm, headwinds for the dollar include growing questions around the greenback’s safe-haven appeal and reserve-currency dominance, political interference and renewed doubts over the Fed’s independence, escalating tariff tensions, the U.S.-China rivalry, and the ongoing conflict in Ukraine.
“You’ve got massive public deficits, inflation that hasn’t gone away, and a general sense that something’s off,” says Luciano Duque, chief investment officer at C3 Bullion. “People aren’t running to Treasurys like before; they’re turning to gold. The idea that you could print (money) endlessly without consequences is gone.”
Lower Interest Rates
When people get worried about the economy, the stock market or geopolitics, they often turn to so-called safe-haven investments.
Gold is one, but government debt, especially U.S. Treasurys, is another. Government debt pays interest, and that creates an opportunity cost for gold, which doesn’t pay interest.
When interest rates fall, that opportunity cost is lessened, which encourages investors to move some money into gold. The Federal Reserve has cut interest rates twice this year, creating yet another tailwind for gold prices.
[Is Gold a Good Investment Right Now?]
Types of Gold ETFs
Despite the risks of being a volatile commodity, some investing experts say gold should make up a small portion of portfolios as a safety net.
One way to invest in gold is by buying physical bars, coins or jewelry. But this comes with a certain amount of illiquidity, as well as potential storage and insurance costs.
Buying gold futures is another route to take, but leverage, a continual need to roll over expiring contracts and special permission needed from brokerages often mean futures aren’t a good choice for everyday investors.
Those reasons are behind why gold ETFs have become so popular. These funds trade on an exchange just like stocks while at the same time giving investors exposure to physical gold, a basket of gold-mining stocks or futures.
“Gold ETFs have made buying gold more accessible to the average investor, as they can be traded like any other stock,” says Steve Azoury, a financial advisor and owner of Azoury Financial.
With that in mind, here’s a look at five top gold ETFs, their fees and assets under management (AUM):
| ETF | Expense Ratio | AUM |
| SPDR Gold Shares (GLD) | 0.40% | $136.7 billion |
| VanEck Gold Miners ETF (GDX) | 0.51% | $21.8 billion |
| VanEck Junior Gold Miners ETF (GDXJ) | 0.51% | $8.0 billion |
| Invesco DB Precious Metals Fund (DBP) | 0.75% | $233.7 million |
| Direxion Daily Gold Miners Index Bull 2X Shares (NUGT) | 1.13% | $935.7 million |
SPDR Gold Shares (GLD)
When it comes to ETFs that are backed by physical gold, this fund run by State Street Investment Management is the biggest, with $136.7 billion in assets under management, or AUM.
GLD was the first gold-backed ETF to trade on U.S. markets, and it remains one of the most popular gold ETFs with both retail and institutional investors.
The fund’s gold is held on behalf of shareholders with trusted custodians like JPMorgan Chase & Co. (JPM) in the U.S. and HSBC Holdings PLC (HSBC) in London.
The fund has an expense ratio of 0.4%, or $40 annually on $10,000 invested.
VanEck Gold Miners ETF (GDX)
In addition to buying ETFs that are physically backed by bullion in vaults, investors can buy ETFs of gold mining companies. Gold miners’ stocks can outperform the price of gold as the metal rises in value because operating and financial leverage can lead to a higher percentage of increased free cash flow.
However, mining is a difficult business, with challenges going well beyond simply finding gold. Miners can face permitting challenges, operational issues at mines and the consequences of poor management decisions. By investing in many miners at once, equity-backed gold ETFs spread out this risk.
This one tracks the MarketVector Global Gold Miners Index and has an expense ratio of 0.51%.
VanEck Junior Gold Miners ETF (GDXJ)
In addition to large mining companies with producing operations, the gold mining sector also has so-called junior miners that are primarily involved in exploring for gold, developing mines or producing much smaller amounts than their larger brethren.
These miners tend to be more risky, and so an ETF can be particularly helpful. But that diversification can be a double-edged sword because it means the ETF as a whole may not perform as well as a single gold miner that strikes it rich.
This ETF tracks the MVIS Global Junior Gold Miners Index, and has an expense ratio of 0.51%.
Invesco DB Precious Metals Fund (DBP)
Investors who want exposure to gold futures contracts without the hassle of setting up a futures trading account can turn to this offering. While this fund also invests in silver and platinum futures, roughly 80% of its holdings are in gold futures traded on the Comex division of the New York Mercantile Exchange.
An advantage to futures over mining stocks is that futures will track the price of gold more closely. And, unlike physical gold, which is priced on the spot market, futures offer investors a chance to express an opinion about where prices will go in coming months.
Direxion Daily Gold Miners Index Bull 2X Shares (NUGT)
Aggressive investors who want to trade gold rather than hold it for the long run can consider NUGT. This fund is a leveraged ETF, which may not be suitable for more conservative investors.
NUGT has a stated objective of providing two times the performance of the NYSE Arca Gold Miners Index on a daily basis. That index contains domestic equities, American depositary receipts and global depositary receipts of U.S. and international companies in the gold mining and processing industry. In addition to those holdings, the fund invests in derivative securities such as gold futures and swap agreements that provide twice the return of the benchmark.
With an expense ratio of 1.13%, NUGT is substantially more expensive than the other funds on this list.
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5 Best Gold ETFs to Buy for 2026 originally appeared on usnews.com
Update 11/21/25: This story was published at an earlier date and has been updated with new information.
