Which ETF is Better for Retail Investors: SPDR Gold Shares (GLD) or iShares Silver Trust (SLV)?

SPDR Gold Shares (NYSEMKT:GLD) stands out for its lower ongoing costs and much larger assets under management, while iShares Silver Trust (NYSEMKT:SLV) has delivered higher recent returns but with greater price swings.

Both SPDR Gold Shares and iShares Silver Trust are designed to track the price of a single precious metal—gold and silver, respectively—without leverage or added complexity. For investors comparing GLD and SLV, the choice may come down to which metal exposure, risk profile, and cost structure best fits their portfolio.

Snapshot (cost & size)

GLD looks more affordable with a 0.40% expense ratio compared to SLV’s 0.50%. Neither fund offers a dividend yield, so cost differences are the main driver for ongoing expenses.

Performance & Risk Comparison

What's Inside

SPDR Gold Shares is a single-asset fund backed entirely by physical gold, with a 21-year track record and assets under management (AUM) of $141.4 billion. Its sector classification is 100% precious metals, and there are no quirks or structural overlays—investors get pure gold price exposure, with no dividend distributions or equity holdings.

iShares Silver Trust also provides direct exposure to its underlying metal, with 100% precious metals sector classification due to silver’s commodity status in the database. There are no notable quirks, and no underlying company holdings, offering straightforward tracking of physical silver prices.

For more guidance on ETF investing, check out the full guide at this link.

Foolish Take

These two ETFs are among the most prominent and most popular precious metal ETFs around -- and for good reason. Each one focuses on a globally sought-after precious metal -- either gold or silver. Each one also offers affordable -- though average-at-best -- expense ratios. Being ETFs linked to physical commodities, they offer no dividend yield, which may give pause to some income-oriented investors.

Nevertheless, due to their inflationary-fighting appeal, there is typically a place within most portfolios for a precious metal ETF. So, which one should retail investors seek out?

The answer largely lies in the investor themselves. For many, the appeal of gold is irresistible. For millennia, gold has acted as a store of value. Moreover, its appeal extends beyond this traditional role. Roughly 50% of gold is used in jewelry, while the yellow metal also boasts a key role in the manufacturing process for certain medical, dental, and electronics materials.

Meanwhile, silver, has both similarities and key differences to its gleaming cousin. While silver remains a popular choice for both coinage and jewelry, sliver is highly prized for certain industrial uses. These include solar panels, industrial-strength mirrors, electronics, and water purification.

In other words, there are good reasons to own both metals -- and by extension, both ETFs. However, given gold's greater price stability, conservative investors may wish to shade their ownership towards the yellow metal, while those investors willing to take on greater risk might choose Silver.

Glossary

Expense ratio: Annual fee, expressed as a percentage of assets, charged by a fund to cover operating costs.
Assets under management (AUM): Total market value of assets a fund manages on behalf of investors.
Drawdown: The maximum observed loss from a fund's peak value to its lowest point over a specific period.
Max drawdown: The largest percentage drop from peak to trough in a fund's value during a set timeframe.
Total return: Investment gain including both price changes and any income, such as dividends or interest, over a period.
Direct exposure: Investment approach where a fund holds the underlying asset itself, not derivatives or related securities.
Dividend yield: Annual dividends paid by a fund or stock, expressed as a percentage of its current price.
Physical gold/silver: Actual bullion held by a fund to back its shares, rather than futures or other financial instruments.
Sector classification: The industry or category assigned to a fund based on its primary holdings or investment focus.
Leverage: Use of borrowed money or financial derivatives to increase potential returns, often increasing risk.

Jake Lerch has positions in SPDR Gold Trust. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.