Contact us
CALL US NOW 1-888-GOLD-160

ETF Gold Holdings Set Yet Another Record

  by    0   0

Gold continued to flow into gold-backed ETFs, setting another all-time record in April.

Globally, funds added another 170 tons of gold last month amounting to $3.9 billion, according to the latest data from the World Golf Council. It was the sixth straight month of net inflows.

April’s inflows pushed total ETF gold holdings globally to a record of 3,355 tons. Assets under management (AUM) also reached a new record high of US$184 billion as gold in US dollars moved higher by 5.8%.

This continues an upward trend. Gold-backed ETFs added over 460 tons of gold through the first four months of 2020. Gold ETF assets have grown 80% in the past year. Rolling 12-month inflows of 879 tons slightly surpassed those of 2009 and 2016.

North American funds accounted for the bulk of inflows last month, increasing holdings by 144 tons. SPDR Gold Shares led global inflows, adding 89.5 tons (US$4.9bn, 9.7%).

European funds added an additional 20 tons. Asian ETFs also charted strong inflows of 2.9 tons, primarily into Chinese-based funds. Other regions, including Australia, had inflows of 3.3 tons.

Looking more broadly at the gold investment market, the yellow metal in US dollars finished the month above $1,700 – a monthly closing level not seen since 2012. While gold remains 10% below all-time highs in dollar terms, it continued to make all-time highs in every other major currency, including Australian and Canadian dollars, euro, pounds, yen, and yuan. Gold also made a new high in Swiss francs during April.

According to the World Gold Council, at the time of its report, gold had outperformed most major asset classes in 2020. The yellow metal was up by more than 11% in US dollar terms.

And while bond and stock prices also rallied in April, supported by a very accommodative global monetary policy stance, investors are likely to face more volatility, especially since indices like the S&P 500 experienced their strongest monthly performance since 1987. The recent market volatility and price behavior of broad-based global assets provided an opportunity to highlight gold’s effectiveness as a hedge.”

According to WGC analysis, gold continues to behave similarly to the way it did in the 2008 financial crisis. As we have explained, gold dipped initially and then rallied as central bank monetary policy started to bite. The timeframe has been contracted in this crisis and the central bank easing has been on hyperdrive.

As noted in our March Gold ETF flows report, the price strength of gold has, so far, mirrored that of the Global Financial Crisis. At that time it rallied back following the initial Quantitative Easing (QE) program in the US, which, along with similar monetary policy interventions worldwide, propelled gold over 130% higher at its peak in September 2011.”

The WGC report concluded that “uncertainty, along with the unknown ability of central banks to support the markets, that could continue to drive investment demand for gold.”

Inflows of gold into ETFs are significant in their effect on the world gold market, pushing overall demand higher.

There’s a difference between investing in gold-backed ETFs and physical gold. Learn more here.

ETFs are backed by physical gold held by the issuer and are traded on the market like stocks. They allow investors to play gold without having to buy full ounces of gold at spot price. Since their purchase is just a number in a computer, they can trade their investment into another stock or cash pretty much whenever they want, even multiple times on the same day. Many speculative investors appreciate this liquidity.

There are good reasons to invest in ETFs, but they aren’t a substitute for owning physical metal. In an overall investment strategy, SchiffGold recommends buying gold bullion first.

When considering gold-backed ETFs, you should always keep in mind that you don’t actually own the gold. Buying the most common ETFs does not entitle you to any actual amount of the precious metal.

Download SchiffGold's Gold vs GLD EFT's Guide Today

Get Peter Schiff’s key gold headlines in your inbox every week – click here – for a free subscription to his exclusive weekly email updates.
Interested in learning how to buy gold and buy silver?
Call 1-888-GOLD-160 and speak with a Precious Metals Specialist today!

Related Posts

Government Policy Changes Should Boost Indian Gold Market

Some policy shifts recently announced by the Indian government in its Union Budget will likely have a positive impact on the country’s gold market. India ranks as the second-largest gold-consuming country in the world, second only behind China. The three key policy changes that will likely affect the gold market are:


Fed Expands Record Holdings of US Debt

The Federal Reserve expanded its record holdings of US Treasuries in the fourth quarter of 2020 as it continued monetizing the massive federal debt. The Federal Reserve added another $253 billion to its Treasury holdings in Q4 according to the Fed’s Treasury International Capital data released on Feb. 16. That brought the central bank’s US […]


US Treasury Department Set to Unleash Another Tidal Wave of Inflation

The Federal Reserve increased the money supply at a record rate in 2020. And a move recently announced by the US Treasury Department will mean even more money flooding into the marketplace. In other words, another tidal wave of inflation.


The Fed Just Keeps Getting More and More Dovish

Is Jerome Powell the most dovish Fed chair yet? Peter Schiff said he wasn’t when he first took the position and was raising interest rates. But he is now. The minutes from the January FOMC meeting released last week bear this out. “We’re all doves now. That is the problem, the Fed gets progressively more […]


Kansas Bill Would Make Gold and Silver Legal Tender in the State

A bill introduced in the Kansas House would recognize gold and silver specie as legal tender and repeal all taxes levied on it. The legislation would pave the way for Kansans to use gold and silver in everyday transactions, a foundational step for the people to undermine the Federal Reserve’s monopoly on money.


Comments are closed.

Call Now