When gold is glittering, miners can shine even brighter.
Gold has had a strong start to the year, with futures traded in New York up about 6% year to date. Gold miners have done even better, with the Philadelphia Gold and Silver Index of precious metals mining companies up about 15%.
Gold mining stocks can outperform the price of gold as the metal rises in value because the increase in the gold price adds to cash flow while operating and financial leverage amplify the gains. This may be happening as production costs and company debt remain stable. While lower gold prices can have the opposite effect, companies in a declining gold-price environment can take measures to offset the damage by cutting costs, finding efficiencies or boosting production.
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Another advantage of mining companies is that they can use cash flow to fund dividends (unlike non-yield-bearing gold) or share buybacks. This can be attractive to investors, helping to push mining stock prices up further.
But there are also risks in owning mining stocks that don’t apply with physical gold. For one, mines might not produce as much gold as expected, or production might be more expensive than anticipated. There can be accidents that bring production to a standstill. Management could embark on an ill-timed acquisition of another company and end up paying too much.
That’s where gold miner exchange-traded funds, or ETFs, shine. These investment vehicles package many different stocks under a single ticker symbol, offering instant diversification to help keep company-specific risk at bay. These funds will still move in the general direction of the price of gold, and will probably even outperform it in a rising-price environment, even if one of the ETF’s holdings falters.
There are also other types of gold ETFs out there. Some are backed by physical gold stored in vaults, while others are backed by futures contracts. In these cases, the funds still trade on stock exchanges like regular shares of a company, meaning they’re much easier for investors to manage than actually trading futures or buying and storing physical gold themselves.
“We keep a close watch on physically backed gold ETFs, as they often serve as an early indicator of investor sentiment,” says Joe Cavatoni, senior market strategist at the World Gold Council, a trade group. “What we’ve seen through 2025 and into 2026 is increased investment in terms of the monetary value of inflows and the total holdings in tons, both of which are trending at record levels.”
Why Is Gold Doing So Well This Year, Anyway?
A big reason gold prices are rising is investor worry about a weaker U.S. dollar. The ICE U.S. Dollar Index, which measures the greenback against a basket of world reserve currencies, fell about 9% over the past 52 weeks as Federal Reserve interest rate cuts made U.S. bond yields less attractive, higher U.S. tariffs introduced uncertainty about the economy, and President Donald Trump threatened to oust Fed Chair Jerome Powell.
These factors boosted gold for a couple of reasons. First of all, gold is seen as a store of value, holding up even when government-backed currencies falter. Also, the precious metal is seen as a safe-haven investment, and investors and traders tend to flock to it when there is concern about the economy or geopolitics.
What Does Fed Independence Have to Do With Gold Prices?
Investors haven’t gotten any less worried about Federal Reserve independence this year, either, as Trump’s Justice Department opened a criminal investigation into Powell, a move that has faced bipartisan opposition.
“Should the Fed’s independence be compromised, the Fed may become another tool in President Trump’s toolbox to spend as much as possible and potentially devalue the U.S. dollar further,” says Steven Orrell, vice president and portfolio manager at Orrell Capital Management.
Influence of Geopolitics and Central Banks on Gold Prices
Geopolitics has also been behind soaring gold prices. “Worry over neo-con type U.S. military involvement and occupation in Venezuela, Iran, Greenland, in U.S. blue-state cities, etc., along with a possible $1.5 trillion U.S. War Department budget, all with the potential for exacerbating the U.S. fiscal deficit and national debt that could hammer the value of the U.S. dollar,” says Thomas Winmill, portfolio manager at Midas Funds.
Another key factor underlying gold’s rally has been central-bank buying. Central banks are trying to diversify some of their holdings out of U.S. dollars for similar reasons as institutional investors and individuals. Additionally, they’ve seen the U.S. ramp up sanctions on international dollar-denominated assets after Russia’s invasion of Ukraine. Last year through the third quarter, central banks bought 634 metric tons of gold, according to the World Gold Council.
“The Trump administration has shown through multiple endeavors in their year in office that they do not plan to curtail the trend of the government devaluing the U.S. dollar,” Orrell says. “Combined with the weaponization of the dollar during the Ukraine-Russia war, central banks around the globe have taken note.”
With that in mind, here’s a look at five top gold ETFs, their fees and assets under management (AUM) as of Jan. 15:
| Gold ETF | AUM | Expense Ratio |
| SPDR Gold Shares (ticker: GLD) | $159.3 billion | 0.40% |
| VanEck Gold Miners ETF (GDX) | $29.1 billion | 0.51% |
| VanEck Junior Gold Miners ETF (GDXJ) | $10.5 billion | 0.51% |
| Invesco DB Precious Metals Fund (DBP) | $288.0 million | 0.75% |
| Direxion Daily Gold Miners Index Bull 2X Shares (NUGT) | $1.3 billion | 1.13% |
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 around $159.3 billion in assets. 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.
Tom Taulli, author of “All About Commodities,” says he has owned GLD for many years. “It’s very liquid, with lots of daily volume,” he says. “It has also been around for over 20 years and does a very good job tracking the spot price of gold. Because of its scale, GLD also has major holders like institutional investors, hedge funds and so on.”
VanEck Gold Miners ETF (GDX)
“Gold miner ETFs are predicated on the idea that below-ground gold reserves are priced at a meaningful discount to current spot prices, and that mining companies can extract those reserves at an attractive cost structure,” says Bradley Calder, executive director of investments at TIFF Investment Management.
This mining equity ETF tracks the MarketVector Global Gold Miners Index and has an expense ratio of 0.51%. It has $29 billion in AUM. The fund is up more than 13% so far this year as of Jan. 15, and it’s gained 166% over the past 12 months.
GDX holds the world biggest gold miners, including Newmont Corp. (NEM) and Barrick Mining Corp. (B). Their size and geographic diversification give larger mining companies a measure of stability that can be welcome in a difficult industry.
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%. It has $10.5 billion in AUM and is up 11.8% so far this year.
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, most of its holdings are in gold futures traded on the Comex division of the New York Mercantile Exchange.
Futures tend to track the price of gold more closely than mining stocks. 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.
Collin Plume, CEO of Noble Gold Investments, points out that futures-backed funds don’t own gold, they own futures contracts that have to be closed out or rolled over into fresh contracts before they expire.
“If the futures curve is in contango, meaning future prices are higher than the spot price, you pay a ‘roll cost’ every time your contracts expire,” he says. “It’s a slow leak, and some months it doesn’t matter, but other months it’s death by a thousand cuts.”
This fund has a 0.75% expense ratio, $288 million in AUM, and is up 11.7% so far this year as of Jan. 15.
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.
This fund has a 1.13% expense ratio, $1.3 billion in AUM and is up 27.7% so far this year. NUGT’s one-year return is 477.7%, but these eye-popping results aren’t typical.
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5 Best Gold ETFs to Buy for 2026 originally appeared on usnews.com
Update 01/16/26: This story was published at an earlier date and has been updated with new information.
