Gold ETFs have seen record inflows in 2025-26 as investors seek exposure to the gold price rally without the hassle of physical gold. But with several options available in the US, which gold ETF is right for you? This complete comparison covers GLD, IAU, GLDM and more — including options for NRIs wanting India gold exposure.
Physical gold has one major problem: storage. If you buy a 1-ounce gold coin or bar, you need to store it safely — either in a home safe (risk of theft), or in a bank safe deposit box (costs money and is not insured), or with a professional vault service (costs 0.1-0.5% annually). You also need to pay dealer premiums of 2-5% over spot price when buying and selling physical gold.
Gold ETFs solve these problems. You buy shares of the ETF on a stock exchange — just like buying shares of Apple or Amazon. The ETF owns physical gold stored in secure vaults, and each share represents a specific fraction of an ounce of gold. You get direct gold price exposure with: no storage headaches, institutional-grade vault security, low expense ratios (0.1-0.4% annually), full liquidity (buy and sell anytime the market is open), and no dealer premium.
In 2025-26, as gold surged to $4,500+ per ounce, US-listed gold ETFs saw record inflows of over 437 tonnes — the highest annual inflow since the ETF was invented. Total AUM in US gold ETFs crossed $280 billion. Institutional investors from hedge funds to pension funds have been using gold ETFs as their primary vehicle for gold exposure.
| ETF | Ticker | Exchange | Expense Ratio | AUM (approx) | Gold per Share |
|---|---|---|---|---|---|
| SPDR Gold Shares | GLD | NYSE Arca | 0.40% | ~$75 billion | ~0.0937 oz |
| iShares Gold Trust | IAU | NYSE Arca | 0.25% | ~$35 billion | ~0.0100 oz |
| SPDR Gold MiniShares | GLDM | NYSE Arca | 0.10% | ~$12 billion | ~0.0093 oz |
| Aberdeen Physical Gold | SGOL | NYSE Arca | 0.17% | ~$3.5 billion | ~0.0967 oz |
| VanEck Merk Gold | OUNZ | NYSE Arca | 0.25% | ~$1.5 billion | ~0.0667 oz |
GLD was the world's first major gold ETF, launched in 2004. It was a revolutionary product that democratised gold investment for retail and institutional investors alike. GLD is backed by physical gold bars stored in HSBC's vaults in London. Each GLD share represents approximately 0.0937 troy ounces of gold.
GLD's biggest advantage is its extraordinary liquidity. With approximately $75 billion in assets and daily trading volume often exceeding $1 billion, GLD is one of the most liquid ETFs of any kind. For institutional investors who need to move large positions quickly, GLD's liquidity is unmatched.
The downside of GLD is its expense ratio of 0.40% per year — the highest of the major US gold ETFs. On a $100,000 investment, this means $400 per year in fees. Over 10 years at current gold prices, this amounts to approximately $4,000+ in fees versus alternatives like GLDM. For long-term investors, this is a meaningful cost.
IAU was launched by BlackRock's iShares in 2005, one year after GLD. It is structurally identical to GLD — backed by physical gold bars in vaults (primarily in New York, London and Toronto) — but with a lower expense ratio of 0.25% versus GLD's 0.40%.
Over 10 years, the 0.15% expense ratio difference between IAU and GLD compounds meaningfully. On a $100,000 investment, IAU saves approximately $150 per year versus GLD — not dramatic but meaningful for long-term investors. IAU has also had significant inflows in 2025-26 and now manages approximately $35 billion in assets.
The main difference between IAU and GLD is that each IAU share represents 0.01 ounces of gold (versus GLD's 0.0937 ounces), making IAU shares much cheaper in absolute price. This is actually attractive for retail investors who want to buy small amounts regularly.
State Street (the same company that manages GLD) launched GLDM in 2018 specifically to compete with lower-cost ETFs. With an expense ratio of just 0.10% — the lowest among major US gold ETFs — GLDM is the most cost-efficient option for buy-and-hold investors.
GLDM is backed by the same physical gold infrastructure as GLD and holds gold in the same HSBC vaults. The key difference is the lower fee and slightly less liquidity than GLD. For most retail investors who are simply trying to hold gold for the long term as a portfolio hedge, GLDM's combination of low cost and adequate liquidity makes it an excellent choice.
| Factor | GLD | IAU | GLDM |
|---|---|---|---|
| Expense Ratio | 0.40% | 0.25% | 0.10% |
| AUM | ~$75B | ~$35B | ~$12B |
| Daily Volume | Highest | Very High | Moderate |
| Bid-Ask Spread | Tightest | Very Tight | Moderate |
| Options Available | Yes (liquid) | Yes (less liquid) | Limited |
| Share Price (approx) | ~$425 | ~$46 | ~$43 |
| Best For | Institutions, traders | Long-term retail | Cost-conscious long-term |
| 10-Year Fee (on $100K) | ~$4,200 | ~$2,600 | ~$1,050 |
This is critically important and often overlooked. In the United States, gold ETFs (GLD, IAU, GLDM) are classified as "grantor trusts" that hold physical gold. Under US tax law, gold is classified as a "collectible" — not a normal financial asset. This means long-term capital gains on gold ETF sales are taxed at the collectibles rate of 28% for high-income taxpayers — significantly higher than the standard long-term capital gains rate of 0-20% for stocks and most ETFs.
For comparison: if you sell Apple stock after holding for over a year, you pay 0-20% capital gains tax. If you sell GLD after holding for over a year, you potentially pay 28% capital gains tax. This is a meaningful tax disadvantage that long-term investors should be aware of.
One partial solution: VanEck's OUNZ ETF allows investors to actually take delivery of physical gold instead of cash — which some tax strategies use. However, most standard financial advisors simply factor the higher collectibles tax into the expected after-tax return on gold ETF investments.
Indians living in the United States who want gold exposure linked to India — either for cultural reasons, to track Indian gold prices, or as a currency diversification play — have several options:
Buying GLD, IAU or GLDM is as simple as buying any stock. You need a US brokerage account — Fidelity, Charles Schwab, TD Ameritrade, Robinhood, or any major broker. Simply search the ticker symbol (GLD, IAU or GLDM), enter the number of shares you want to buy, and place the order. There is no minimum investment beyond the price of one share.
For regular investing (dollar-cost averaging), most brokerages now allow fractional share purchases — so you can invest a fixed dollar amount (say $500 per month) regardless of the share price. This is the recommended approach for building a long-term gold position.
For most long-term retail investors, GLDM (0.10% expense ratio) offers the best value. For maximum liquidity and options trading, GLD is the standard. IAU at 0.25% is a good middle ground. All three are physically backed by real gold in secure vaults.
IAU is better for long-term buy-and-hold investors because of its lower 0.25% expense ratio vs GLD's 0.40%. GLD is better for active traders and institutional investors who need maximum liquidity and tight bid-ask spreads. For most retail investors, IAU saves meaningful fees over time.
GLD, IAU and GLDM are physically backed by real gold bars in secure institutional vaults. They carry minimal counterparty risk. However, gold prices are volatile — gold can fall 15-20% in a year. Gold ETFs are appropriate as a portfolio hedge (5-15% allocation) rather than a core investment.
US gold ETFs (GLD, IAU, GLDM) are taxed as collectibles under US law. Long-term capital gains (held over 1 year) are taxed at a maximum rate of 28% — higher than the 20% maximum rate for stocks and most other ETFs. Short-term gains are taxed as ordinary income.
Yes. NRIs can open a demat account in India and buy Gold ETFs via NRE or NRO bank accounts. Sovereign Gold Bonds are also available to NRIs through NRE/NRO accounts at major Indian banks — offering 2.5% annual interest plus gold appreciation with zero capital gains tax on maturity.