Gold Prices Are on the Move: Is GLD or IAU the Better ETF Pick?
Key Points
IAU offers a lower expense ratio than GLD, making it more cost-effective for long-term holding.
Both funds delivered nearly identical one-year returns and track the price of gold with similar risk profiles.
GLD is much larger and more liquid, which could appeal to those prioritizing ease of trading.
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Both iShares Gold Trust (NYSEMKT:IAU) and SPDR Gold Shares (NYSEMKT:GLD) are designed to reflect the price of physical gold, offering a simple way to gain gold exposure without holding bullion. The main differences come down to cost, fund size, and trading liquidity, with both ETFs delivering almost identical gold price exposure and recent performance.
This comparison focuses on how these two heavyweight gold funds stack up on costs, performance, and trading characteristics for investors considering a gold allocation.
Snapshot (cost & size)
| Metric | IAU | GLD |
|---|---|---|
| Issuer | iShares | SPDR |
| Expense ratio | 0.25% | 0.4% |
| 1-yr return (as of 4/3/26) | 50.07% | 49.92% |
| Beta | 0.67 | 0.67 |
| AUM | $71.4 billion | $156.7 billion |
Beta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-yr return represents total return over the trailing 12 months.
IAU is more affordable on an ongoing basis thanks to its lower expense ratio, while GLD charges a higher fee but offers greater scale and trading volume. Since neither fund pays a dividend, yield is not a factor in this comparison.
Performance & risk comparison
| Metric | IAU | GLD |
|---|---|---|
| Max drawdown (5 y) | -21.82% | -21.03% |
| Growth of $1,000 over 5 years | $2,671 | $2,651 |
What's inside
GLD is backed by physical gold bullion and has become the largest and most liquid gold ETF globally, with over $155 billion in assets under management and a track record spanning more than 21 years. Its holdings consist entirely of gold, classified as 100% basic materials, and while it does not disclose individual bar details in this summary, it is designed for investors seeking direct gold price exposure with deep liquidity.
IAU is also fully backed by physical gold and tracks the price of gold. Like GLD, it provides pure gold exposure, but it is smaller in fund size and charges a lower expense ratio, appealing to cost-conscious investors.
For more guidance on ETF investing, check out the full guide at this link.
What this means for investors
Both IAU and GLD are backed by physical gold bullion and track the price changes of the precious metal, which has increased more than 170% in the last five years. Gold is often viewed as a safe haven alternative investment, as it can provide a hedge against inflation and volatile market conditions and help to diversify an investment portfolio. The slight discrepancy in the funds’ overall growth and returns primarily comes down to the fees investors pay to hold the funds — while GLD holds more assets under management, it also charges a slightly higher expense ratio, meaning it takes a larger cut from investors who hold it. For long-term investors, higher fees can slowly erode returns over time.
With betas under 1, these gold-tracking ETFs are less volatile than the broader market, making them an attractive investment in uncertain economic conditions. And holding shares in a brokerage account is certainly more convenient and less costly than storing physical gold bars, though some investors may see value in holding assets outside of the traditional banking structure.
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Sarah Sidlow has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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