The price of gold has been soaring over the past year as investors look for safety amid trade and tariff concerns. It has hit record highs and it may be a matter of time before it hits $4,000 USD per ounce.
The shiny metal has traditionally been in high demand during times of uncertainty and when investors are concerned about the markets. Rather than holding gold bars, however, what you may want to consider if you want exposure to this trend is to invest in an exchange-traded fund (ETF). The iShares Gold Trust (NYSE Arca:IAU) has risen by around 40% this year, as it has proven to be a hotter investment than the S&P 500 index, which is up around 12%. Remarkably, over the past five years, both the Gold Trust ETF and the broad market index have doubled in value. While investing in the S&P 500 had been a better option heading into 2025, as the threat of tariffs emerged, investors piled more money into gold funds, in search of safety.
The iShares fund has an expense ratio of 0.25% and it doesn’t provide investors with a dividend. This is primarily an investment for people who want exposure to gold, and who may want some diversification for their portfolios.
If you expect gold to continue rising in value, then this ETF can be a great investment to put into your portfolio. But there’s the risk that it could also be approaching a peak, and that the upside may be limited, especially given how strong of a run it has been on of late.
