Best Gold ETF UK – Compare Top ETFs for 2021

If you’re thinking about investing in gold – this offers a great way to hedge against the stock markets and rising inflation levels. The good news is that you don’t need to physically buy gold coins or bars. In choosing the best ETF for you, important metrics to consider include annual fees, the minimum investment, and whether or not the instrument is actually backed by gold.

In this guide, we clear the mist by reviewing the best gold ETFs UK for 2021.

67% of retail investor accounts lose money when trading CFDs with this provider.

Best Gold ETF UK 2021 List

If you’re strapped for time and looking to invest in the best gold ETF UK right now – consider the following options. You can scroll down to read our full analysis of each ETF in more detail.

  1. SDPR Gold ETF – Overall Best Gold ETF UK – Invest Now
  2. VanEck Vectors Gold Miners ETF – One of the Best Gold Mining ETFs – Invest Now
  3. iShares Gold Trust ETF – Best Gold ETF UK for Tracking Spot Price – Invest Now
  4. Sprott Physical Gold Trust – Best Gold ETF UK for Redeeming Bullion Bars
  5. Gold and Energy CopyPortfolio – Diversified Portfolio of Gold ETFs

Best ETFs UK Reviewed

We spent countless hours in our search for the best gold ETF UK for 2021.

In order to cover all bases, we looked at a variety of important factors – such as:

  • The type of gold ETF
  • Whether the ETF is backed by physical gold
  • The reputation and financial standing of the ETF provider
  • What stock exchange the gold ETF is listed on
  • How much the gold ETF UK charges in annual fees
  • The minimum amount required to invest in the gold ETF

Taking all of the above into account, we found that the following providers offer the best ETFs that allow you to invest in gold companies right now.

1. SPDR Gold ETF – Overall Best Gold ETF UK 

For us, if you are looking to invest in gold – whether that’s on a short-term or long-term basis, nothing gets close to the SPDR Gold ETF. In a nutshell, this is the largest gold ETF in the industry. Most importantly, the ETF is backed by physical gold – meaning this offers you the best chance of gaining exposure to rising prices without taking direct ownership.

The way this gold ETF works is actually very straightforward. Firstly, the ETF is listed on the NYSE Arca and it is represented in shares. As such, the value of the SPDR Gold ETF will move up and down throughout the trading day. And as you likely guessed – this rise and gall in value will correlate directly to the current market price of gold.

SPDR GOLD ETF at eToro

Crucially, another benefit of this ETF being listed on the NYSE Arca is that you can enter and exit the market at any given time – during standard hours. As such, your money is never tied up. Plus, unlike a traditional gold investment in form of physical coins or bars – you don’t need to cash out the full amount.

For example, let’s suppose that you invested £1,000 in the SPDR Gold ETF. A few months into the investment, you might want to reduce your exposure by 20%. All you would need to do is sell £200 worth of your gold ETF investment at your chosen broker and leave the remaining £800 in play.

In terms of how to invest in this top-rated gold ETF, you can actually complete the process at eToro without paying any commission. Additionally, the minimum investment amount specified is just $50 – or about £35. This allows you to dabble in gold without needing to invest huge amounts.

Your capital is at risk.

2. VanEck Vectors Gold Miners ETF – One of the Best Gold Mining ETFs  

An additional option that you might consider in your search for the best gold ETF UK is that of mining companies. These are firms are directly involved in gold mining – of which there are hundreds. Many are actually very small operations with no guarantee of success – as this is determined by the amount of gold the firm is able to find and extract.

With this in mind, it could be worth taking a more diversified apporach via the VanEck Vectors Gold Miners ETF. In doing so, you will be investing in 51 different gold mining companies. This includes some of the biggest mining operations globally – covering the likes of Newmont, Barrick Gold, Franco-Nevada, Kirkland Lake, Gold Fields, and Royal Gold.

VanEck Vectors Gold Miners Etf

Crucially, the ETF portfolio not only contains companies from various regions of the world – but it is weighted. This means that greater exposure is giving to less risky gold mining companies with a proven track record in this space. Much like the previously discussed SPDR Gold ETF, the VanEck Vectors Gold Miners ETF is listed on the NYSE Arca.

Once again, this means that your investment is liquid because you can cash it out any time the market is open. In terms of past performance, The VanEck Vectors Gold Miners ETF was priced at just under $20 per share in the five years prior to writing this guide.

Fast forward to early 2021 and the same ETF is valued at just over $31 per share. This represents gains of 55% in just five years of trading. During the same 5-year period, the spot price of gold increased by 33%. As such, the VanEck Vectors Gold Miners ETF has outperformed the wider market.

Your capital is at risk.

3. iShares Gold Trust ETF – Best Gold ETF UK for Tracking Spot Price  

Another option to consider is the iShares Gold Trust ETF. This particular ETF will look to track the spot price of gold as closely as possible. Much like the SPDR Gold ETF, the iShares Gold Trust is backed by physical gold. This is stored in vaults in several safe haven locations around the world to hedge against currency fluctuations.

The underlying framework of this ETF is very simple – insofar that the rise or fall of your investment will closely mirror that of gold’s spot price. For example, in the 12 months prior to writing this guide, the benchmark price of gold increased by 24.17%. In the case of the iShares Gold Trust ETF, returns of 23.83% were realized.

iShares Gold Trust

This means that you are able to invest in the future value of gold in a super-easy and cost-effective way. Regarding the latter, the iShares Gold Trust ETF charges a sponsor fee of just 0.25%. This means that a £10,000 investment would amount to an annual charge of just £25. Plus, when investing in this ETF via eToro – you won’t pay any dealing fees to buy or sell.

Your capital is at risk.

 

4. Sprott Physical Gold Trust – Best Gold ETF UK for Redeeming Bullion Bars  

In many ways, the Sprott Physical Gold Trust is very similar to the previously discussed SPDR and iShares ETF. This is because the ETF provider invests in physical gold bullion. As such, the value of your ETF investment will correlate very closely to the rise and fall of gold’s spot price.

With that said, the Sprott Physical Gold Trust is an interesting option, as it gives you the opportunity to actually redeem your investment in physical gold bars. In order to be eligible, you would need to own the equivalent of 400 oz of gold via the ETF. For example, at the time of writing, 400 oz of gold is worth approximately $720,000.

Sprott Physical Gold Trust

As such, unless you were looking to invest a significant amount into this gold ETF – you likely won’t have enough exposure to redeem your holdings. But, we like the fact that when you invest in the Sprott Physical Gold Trust – legally, you have the remit to receive your holdings nonetheless.

Your capital is at risk.

5. Gold and Energy CopyPortfolio – Diversified Portfolio of Gold ETFs  

Most of the gold ETFs that we have discussed today largely concentrate on physical backed funds. That is to say, the ETF provider in question will buy and store the asset – and your share will be reflected in the stock price of the gold exchange-traded fund. However, if you want to take things to the very next level – it might be worth considering the Gold and Energy CopyPortfolio.

In a nutshell, this is a professionally-managed portfolio is offered by FCA-broker eToro. The portfolio will allow you to gain exposure not only to gold – but the wider energy sectors. This is because the Gold and Energy CopyPortfolio contains a basket of 8 different ETFs.

goldenenergy cpoyportfolio etoro

This includes the SPDR Gold ETF, iShares Gold Trust ETF, and the VanEck Vectors Gold Miners ETF. Additionally, you will also gain exposure to other commonly traded commodities, such as oil and silver. Crucially, this ensures that you are not overly exposed to just gold. Rather, you’ll be mitigating your long-term risk by covering other hard assets.

In terms of the specifics, there are no fees to invest in the Gold and Energy CopyPortfolio. As this is professionally managed by eToro itself, the portfolio is regularly rebalanced and reweighted. This means that once you make an investment, there is nothing more for you to do.

Your capital is at risk.

Other Gold ETFs to Consider

Although we have discussed five of the best gold ETFs UK available today – there are many others in the market. As such, it is also worth looking into the following alternatives:

  • SPDR Gold MiniShares Trust
  • Aberdeen Standard Physical Gold Shares ETF
  • GraniteShares Gold Trust
  • Perth Mint Physical Gold ETF
  • Invesco DB Precious Metals Fund

How to Choose the Best Gold ETFs to Invest in

With so many gold ETFs available to UK investors – knowing which one to choose can be a time-consuming task. To help clear the mist, below we discuss what to consider in your search for the best gold ETF UK.

Type of Gold ETF

First and foremost, you need to assess the type of gold ETF that interests you. If you are simply looking to invest in the long-term value of gold, then you will want to opt for an ETF that is physically backed by precious metal. The best options in the market at present at the previously discussed SPDR Gold ETF and iShares Gold Trust ETF.

This is because virtually the entire ETF portfolio is invested in physical gold bars. Naturally, this means that the ETF will rise and fall in value depending on the current spot price of gold. As such, this allows you to gain direct exposure to gold without needing to worry about storage or delivery.

best gold etf uk

On the other hand, there are also gold ETFs that are not physically backed. Instead, the ETF will look to gain exposure to gold in a different way. For example, the VanEck Vectors Gold Miners ETF consists of 51 gold mining companies that are publicly listed. Although these mining firms make more money when the price of gold is high, this isn’t the only factor in play.

Instead, you also need to consider the output of each mining company. For example, the firm might invest vast resources into a new gold mining plot – only to find that the precious metal is inaccessible. Taking these added risks into account, ETFs such as the one offered by VanEck offer higher upside potential.

Past Performance

You might be under the impression that all physically-backed gold ETFs are the same – at least in terms of financial returns. After all, if these ETFs have allocated virtually all client funds into gold, you would expect the rise and fall of its stock price to mirror the market value of gold.

However, this isn’t the case at all, not least because there are other underlying factors in play. For example, in the first two months of 2021, the Shares Gold Strategy ETF made gains of 21.41%. During the same period, the Invesco DB Gold Fund made returns of 17.75%.

This is actually a huge difference when you consider the figures are based on just two months of trading. Largely, this difference in growth might be because of currency exchange risk, where the gold is being stored, and what market rates the ETF obtained at the time of the purchase.

Exchange Listing

As we previously discussed, all gold ETFs are listed on a public stock exchange. In most cases, this is on the NYSE Acra, albeit there are also ETFs on other marketplaces. The key point here is that you’ll want to choose a gold ETF that is listed on an exchange you have access to. Whether or not this is the case might depend on your selected broker.

Expense Ratio and Fees

Like all investments that you make – you always need to pay a fee of some sort. When you buy shares, for example, you will pay your chosen broker a dealing fee or commission. Other than that, you won’t pay anything else until you decide to cash out – unless you are using a broker that charges a monthly/annual platform fee.

Nevertheless, things are slightly different in the world of gold ETFs, as you need to consider fees from two different angles. Firstly, most brokers and stock apps in the UK charge an ETF dealing fee – which is usually fixed.

For example:

  • You might pay £10 to invest in the gold ETF another £10 when you get around to cashing out.
  • Several ETF brokers in this space – such as eToro, allow you to buy and sell gold ETFs commission-free.
  • With that said, there is a second charge at play – the ETF provider’s expense ratio.
  • This covers a variety of costs – such as the process of buying, transporting, and storing gold on your behalf.
  • You then have administrative fees linked to accounting maintenance, processing deposits and withdrawals, and customer support.

The expense ratio charged by the best gold ETFs UK is a variable fee – meaning it is multiplied by the size of your investment. In most cases, this will amount to less than 0.5%. For example, the SPDR Gold ETF has an expense ratio of 0.40%. This means that a £1,000 investment would cost you just £4 per year.

Minimum Investment

You also need to consider what the minimum investment is on your chosen gold ETF. This can and will vary depending on the provider. However, it can also vary depending on whether you invest directly with the ETF provider or through a traditional stock broker. In most cases, the latter allows you to invest with a smaller amount.

invest in gold etoro

For example, the best gold ETF UK that we came across – the SPDR Gold Trust, requires a minimum investment of 1 share when going direct. At the time of writing, that amounts to just over $157. However, if you completed the investment with ETF, the minimum is just $50.

This gives you a much better chance of diversifying. Plus, going direct with the gold ETF provider means that you normally need to deal in full units. As eToro supports fractional ownership – you can invest any amount to the penny so long as you meet the $50 minimum.

Best Gold ETF UK Investment Platforms 2021

So now that we have explained how to choose the best gold ETF UK, we are now going to discuss investment platforms. There are many things that you need to look out for when choosing a commodity trading broker – such as whether or not it supports your preferred gold ETF and what fees you will need to pay.

Additionally, you also need to assess what payments are supported and whether the provider is regulated by the FCA. To save you countless hours of research, below we review the best gold ETF UK platforms currently in the market.

1. eToro – Buy the Best Gold ETFs UK with 0% Commission

eToro is an FCA-regulated brokerage site that now has 17 million clients under its belt. Investors in the UK are attracted by the ease in which you can buy and sell assets on eToro at super competitive prices. Crucially, all of the best gold ETFs UK and best gold funds UK that we have discussed today can be purchased at eToro.

As we briefly mentioned earlier, the broker allows you to invest in gold ETFs without you needing to pay any commission. This means that the only fee that needs to be taken into account is the expense ratio charged by the ETF provider. This will be passed on to you and subsequently reflected in your eToro account.

trade gold on etoro

67% of retail investor accounts lose money when trading CFDs with this provider.

What we also like about eToro is that the minimum ETF investment is just $50. This means that you can buy the best gold ETFs UK with a small amount of capital. Once you have completed your investment, you can check the value of your gold ETF 24/7 via your eToro portfolio. Any time you wish to cash out your gold ETF you can do so at the click of a button – as long as the respective market is open.

We also discussed the Gold and Energy CopyPortfolio at eToro. This allows you to invest in a basket of ETFs that not only track the value of gold, but other commodities like oil and the best silver ETFs. This comes at no extra commission, which is great for those of you that want to invest passively. Assuming that you are also interested in other asset classes, eToro supports more than 2,400 stocks from 17 markets, heaps of non-gold ETFs, cryptocurrencies, and more.

GOLD ETFs on etoro

In terms of getting started with this top-rated brokerage firm, you can open an account, deposit funds, and make your first investment in less than 10 minutes. You can do this via a UK debit/credit card or e-wallet. Bank wires are also an option but take slightly longer to process. When it comes to safety, eToro is regulated by the Financial Conduct Authority (FCA). Plus, you also have the protection of the FSCS scheme – should the unlikely happen and eToro goes bust.

Pros:

  • Super user-friendly online trading platform
  • Buy stocks without paying any commission or share dealing charges
  • Trade CFDs in the form of stocks, indices, commodities, forex, and more
  • 2,400+ stocks listed on the UK and international markets
  • 150+ ETFs
  • Deposit funds with a debit/credit card, e-wallet, or UK bank account
  • Ability to copy the trades of other users
  • FCA and FSCS protections

Cons:

  • Not suitable for advanced traders that like to perform technical analysis
  • No ISAs or SIPPs

67% of retail investors lose money trading CFDs at this site

 

2. Capital.com – Best CFD Broker to Trade Gold ETFs

new capital.com logo

In providing you with an alternative approach to the gold ETF market – it might be worth considering Capital.com. This popular CFD trading platform doesn’t allow you to invest in gold ETFs like eToro. Instead, you will be speculating on the future price of the ETF on a short-term basis.

This is, however, more suited to those of you that have a bit of experience in how online trading works. The benefits of trading gold ETFs UK at Capial.com are three-fold. Firstly, you will have the option of going long or short on your chosen gold ETF. For example, if you thought that gold was overpriced, you place a sell order on the SPDR Gold ETF via CFD derivatives.

Secondly, Capital.com allows you to trade the best gold ETFs UK with leverage. As per UK regulations on margin trading, this allows you to apply leverage of up to 1:5. As such, by staking £50, you can trade with up to £250. Additionally, Capital.com allows you to trade gold ETFs without paying any commission.

Trade SPDR Gold Shares

The spread is really competitive too at this broker. For example, The SPDR Gold ETF can be traded with a spread of just $1.01 (based on a buy price of $157.98). Although CFD trading is best reserved for those with an understanding of this financial instrument, Capital.com requires a minimum deposit of just £20.

This is an inconsequential amount to trade with – making it perfect for newbies. Plus, Capital.com also offers a demo account facility. This allows you to trade the best gold ETFs UK without risking any money. Crucially, the demo account mirrors live market conditions. When you feel ready to trade with real capital, the provider supports debit/credit cards and e-wallets. Finally, Capital.com is authorized and regulated by the FCA.

Pros:

  • Educational app for new traders
  • Commission-free trading
  • Tight spreads
  • Leverage offered
  • AI assistant identifies your weak points
  • Excellent charting and analysis interface
  • £20 minimum deposit

Cons:

  • Cannot build custom trading strategies
  • CFDs only

71.2% of retail investors lose money trading CFDs at this site.

How to Buy the Best Gold ETFs UK

So now that we have discussed the best brokers that allow you to access gold ETFs in the UK – we are going to conclude our guide by showing you how to get started. For this, we are going to walk you through the process with commission-free broker eToro.

Step 1: Open an Account and Upload ID

You will first need to visit the eToro website and open an account.

eToro sign up

67% of retail investor accounts lose money when trading CFDs with this provider.

This is standard practice for all FCA-regulated brokers and simply requires some personal information from you.

Step 2: Confirm Identity

You will also need to upload a copy of your passport or driver’s license. To verify your home address, eToro requires a recently issued bank account statement or utility bill.

If you want to upload these documents at a later date – you can. However, this needs to be done before you can make a withdrawal or deposit of more than $2,250.

Step 3: Make a Deposit

Before you can invest in a gold ETF at eToro – you’ll need to make a deposit.

You can choose from the following payment methods:

  • Debit/Credit Card (Visa, MasterCard, Maestro)
  • Paypal
  • Skrill
  • Neteller
  • UK Bank Transfer

Step 4: Search for Gold UK

All of the best gold ETFs UK discussed on this page are available on eToro. As such, if you already know which ETF interests you – search for it.  In our example, we are searching for the ‘Gold Miners ETF VanEck ETF’.

Gold Miners ETF VanEck ETF on etoro

If not, you can click on the ‘Trade Markets’ button followed by ‘ETFs’. This will then show you each and every gold ETF hosted on the platform.

Step 5: Place a Gold ETF Order

Now you need to place an order on your chosen gold ETF. As you can see from the example below – all you need to do is enter your stake. The minimum is 50 US dollars – so you can enter any amount as long as it meets this figure.

Gold Miners ETF VanEck ETF on etoro

67% of retail investor accounts lose money when trading CFDs with this provider.

Finally, click on the ‘Open Trade’ button to complete your commission-free gold ETF investment!

Conclusion

In summary, if you want to gain exposure to gold – the best option on the table is to go with an ETF.   Not only can you invest without worrying about ownership and storage – but the best gold ETFs UK are priced really competitively.

For example, the best market that we came across – the SPDR Gold ETF – carries an annual expense ratio of just 0.40%. Most of the gold ETFs we have discussed today, allow you to hedge against the FTSE 100 and rising inflation driven by central banks.

Irrespective of which ETF you go with, just make sure that you choose a top-rated broker. eToro is a good option in this respect, as the FCA broker allows you to buy and sell the best gold ETFs UK without paying any commission. The minimum investment is just $50 too – meaning the broker is great for all budget levels.

eToro – Buy the Best Gold ETF UK with 0% Commission

67% of retail investor accounts lose money when trading CFDs with this provider.

FAQs

What is the best gold ETF for UK investors?

After reviewing dozens of potential exchange traded commodities, we found that the best gold ETF for UK investors is offered by SPDR. The ETF is backed by physical gold - meaning you are gaining direct exposure to the future value of this precious metal without needing to worry about storage.

What is the best gold ETF fund for mining companies?

If you are looking to invest in mining companies, the best gold ETF fund for this purpose is offered by VanEck. This ETF will give you access to 51 gold mining companies via a single trade.

What is the minimum gold ETF investment in the UK?

Minimum investment amounts will usually depend on which broker you decide to use. In the case of eToro, the platform allows you to invest in the best gold ETF funds from just $50 - or about 35 GBP.

Where to buy the best gold ETF funds UK?

There are dozens of online brokers that allow you to invest in gold ETFs. We like eToro, as the broker allows you to invest in several different gold ETFs without paying any commission. eToro also offers some of the best gold mining ETFs.

How much do gold ETFs cost in the UK?

The best gold ETFs UK typically charge less than 0.5% per year in annual fees. You also need to check how much dealing fees your chosen broker charges. At eToro, there are no commissions charged on ETFs - so it's only the annual expense ratio that you need to take into account.

 

Kane Pepi

About Kane Pepi PRO INVESTOR

Kane Pepi is a British researcher and writer that specializes in finance, financial crime, and blockchain technology. Now based in Malta, Kane writes for a number of platforms in the online domain. In particular, Kane is skilled at explaining complex financial subjects in a user-friendly manner. Academically, Kane holds a Bachelor’s Degree in Finance, a Master’s Degree in Financial Crime, and he is currently engaged in a Doctorate Degree researching the money laundering threats of the blockchain economy. Kane is also behind peer-reviewed publications - which includes an in-depth study into the relationship between money laundering and UK bookmakers. You will also find Kane’s material at websites such as MoneyCheck, the Motley Fool, InsideBitcoins, Blockonomi, Learnbonds, and the Malta Association of Compliance Officers.

Questions & Answers (0)

Have a question? Our panel of experts willanswer your queries.Post your question