My Guide on How to Pick the Right Gold ETF in 2025

Gold prices are once again at all-time highs. For U.S. investors, that reflects a mix of forces: the so-called “debasement trade,” where expanding money supply and mounting national debt erode the dollar’s purchasing power; central bank stockpiling; and a global backdrop of rising geopolitical instability. In short, investors are once again turning to gold as a hedge against what feels like a fraying financial order.

There’s no shortage of choice in this space. U.S. investors can pick from dozens of gold ETFs (and a few CEFs), but not all are created equal. Some carry high tracking error, others charge steep management fees, and a few add unnecessary complexity through futures, K-1 forms, or synthetic exposure.

To find the right gold ETF for your goals, it helps to define what you’re trying to achieve. Are you looking to hold gold long-term as a hedge against currency debasement? Convert gold’s volatility into a source of income? Or simply express a short-term bullish trade on price momentum?

For each of these main objectives, I’ve chosen what I believe to be the best gold ETF based on fees, liquidity, and purity of exposure. It’s just my view, so if you already have a favourite fund that fits your needs, stick with it—but here’s how I’d approach each category.

Buy-and-Hold

For buy-and-hold investors, low fees matter more than anything else. Over time, the less you pay, the more you keep—simple as that. In this category, nothing beats the iShares Gold Trust Micro (IAUM), which charges a rock-bottom 0.09% expense ratio.

If you plan to hold long term, bid-ask spreads aren’t a big deal since you’re not trading frequently, but even so, IAUM remains highly efficient with a 30-day median spread of just 0.03%. It’s also well-capitalized at roughly $5.6 billion in assets, backed by over 1.3 million ounces of gold held in trust.

For investors who want exposure to physical gold without the headaches of dealer spreads, safes, or storage costs, IAUM is a clean, low-cost alternative—and unlike physical bullion, you can hold it in a tax-sheltered account such as a Roth IRA.

Selling Options

Gold is one of the better assets for covered call or cash-secured put strategies because its volatility tends to rise during periods of uncertainty. Higher volatility means higher option premiums, and in strong bull markets like we’re seeing now, those premiums can get even richer.

The trade-off, of course, is that you give up some upside potential in exchange for immediate income, and those option premiums are taxable as short-term gains.

For this purpose, I like the long-standing SPDR Gold Shares (GLD). While some still use GLD for buy-and-hold exposure, I wouldn’t recommend it for that role today given its 0.40% expense ratio. Where it shines is for option strategies, where liquidity outweighs cost.

It’s a giant, with around $142 billion in assets, and has one of the most liquid options chains in the world—expirations every other day, dozens of strike prices, and deep open interest at nearly every level.

The only drawback is the share price—around $400 per share at the time of writing—so a standard 100-share options contract ties up about $40,000 in capital.

Amplified Upside

If you’re after amplified upside, you could buy gold futures or call options on GLD—but both come with steep learning curves, high volatility, and tax complexity that make them poor fits for most investors.

And don’t even get me started on leveraged gold ETFs, which often suffer from sloppy long-term tracking and K-1 tax forms that can turn a simple trade into a paperwork nightmare.

Instead, my preferred alternative is the VanEck Gold Miners ETF (GDX). It may not seem intuitive at first, but when you think about how gold mining companies work, it’s actually a cost-effective and accessible way to get leveraged exposure to gold.

Here’s why: gold miners’ revenues move with the price of gold, but many of their costs—labour, energy, equipment—stay relatively fixed. So, when gold prices rise, profits expand faster than the metal’s price itself. Add in the fact that most miners use some level of debt financing, and that leverage magnifies returns even further.

It’s not financial magic, just basic math: a small rise in revenue can produce a much larger rise in earnings when costs are mostly fixed. But remember, the same mechanics work to the downside in a gold bear market as well, so it’s not a free lunch.

Another drawback is that you’re still buying stocks, not gold. That means GDX carries equity market risk and doesn’t perfectly track spot gold. But during strong bull markets—like the one we’ve seen this year—it has strong outperformed gold ETFs that hold the metal directly.

The 0.51% expense ratio isn’t cheap, though it’s still roughly half the cost of most leveraged gold ETFs, and GDX even pays a small dividend, with a 30-day SEC yield of about 0.31%.