ETF Edge

Top gold ETF attracts $5.5 billion in assets this year despite cheaper competition

Biggest gold ETF turns 15. Here are other gold funds to watch

It's the gold market's golden child.

SPDR Gold Shares, an exchange-traded fund also known by its ticker GLD, has attracted some $5.5 billion in assets year to date despite less costly competitors on the market, a trend experts say is very bullish when it comes to the fund's longevity.

The largest ETF in the world backed by physical gold, the GLD turned 15 years old on Monday. The fund is up about 210% since its inception versus the S&P 500's 164% gain over the same time frame, and has accrued over $42.28 billion in assets since the public debut.

"Gold has always ... had a real place in the ETF world," Dan Draper, managing director and global head of ETFs at Invesco, told CNBC's "ETF Edge" on Monday.

The GLD was one of the first funds to offer investors indirect access to the price of gold via a simple and cost-effective ETF structure. With an expense ratio of 40 basis points per share, the ETF's shares trade at one-tenth the price of one ounce of gold, giving buyers a cheaper way to invest in gold than purchasing expensive gold bars or risky futures contracts.

Since the GLD came to market, a number of competing and alternative gold ETFs have cropped up, many at cheaper costs. They include the iShares Gold Trust (IAU), the Aberdeen Standard Physical Gold Shares ETF (SGOL), Invesco's own Invesco DB Gold Fund (DGL) and a more recent newcomer, the GraniteShares Gold Trust (BAR).

Todd Rosenbluth, senior director of ETF and mutual fund research at CFRA, found it encouraging that the GLD is still attracting billions in assets despite its rivals' less costly offerings.

"What's ... impressive about how well GLD is doing from a flows perspective this year is it now has much cheaper competition," he said in the same "ETF Edge" interview. "A whole host of products in the last three years have come to market that are from GraniteShares [and] a whole host of other providers that are cheaper, and yet GLD is a default product."

Better yet for the GLD's bull case, gold appears to have transformed into an asset that's not just a hedge against uncertainty or inflation, but, largely, whatever investors want it to be, Tom Lydon, editor and proprietor of, told "ETF Edge" in the same interview.

"When you look for the performance of gold, GLD specifically, in the last 15 years, it's up a lot more than the S&P," he said. "We talk regularly about buying gold for inflationary purposes. There's no inflation, but back in '07 to 2012, the price of gold went up 3x during that period of time. We didn't have any inflation."

In short, "diversification is key," Lydon said. And, if you ask Draper, that concept has propelled gold to its place as one of the hottest commodities on the market.

"Whether it's gold or even broader-based futures, commodities are kind of out of favor now for the most part. But as a diversifier, I think commodities broadly have a real place in a lot of portfolios for clients," the Invesco ETF chief said.

Gold was on the move higher midday Tuesday as stocks faltered on a new hiccup in U.S.-China trade talks.