Gold prices surged to near three-month highs this week, with spot gold reaching $2,755.2 per ounce on Jan. 22, just below its record peak of $2,790.15 from Oct. 31, 2024.
What Happened: As President Donald Trump's tariff announcements reverberate through global markets, gold, often seen as a safe haven during uncertain times, has reclaimed the spotlight. Two of the most prominent ETFs, SPDR Gold Shares GLD and iShares Gold Trust IAU offer exposure to gold with different features to suit various investor profiles.
Both ETFs use the same benchmark: the LBMA (London Bullion Market Association) Gold Market Fixing Price PM Index.
The SPDR Gold Shares ETF is priced at around $244 per share with a 0.40% expense ratio. The ETF appeals to investors seeking high liquidity and trust in a well-established product. Trading volume of the ETF is hefty, making it especially attractive for frequent traders. However, its higher expense ratio and market price may deter cost-conscious retail investors.
The iShares Gold Trust ETF, on the other hand, is priced at around $50 per share with a lower 0.25% expense ratio. It offers a more economical entry point for gold investors. Although no match for GLD’s trading volume, IAU is still highly liquid and considered a viable choice for retail investors.
See Also: Gold’s Blowout Rally Puts Spotlight On Miners: Will They Finally Catch Up?
Why It Matters: The rally is fueled by a weaker dollar and growing uncertainty surrounding Trump's proposed policies, including sweeping tariffs. Some investors fear his decisions will trigger trade wars and heighten market volatility.
Gold, as ever, remains a safe bet for risk-averse investors. While physical bullion remains a traditional choice, its limitations— such as storage costs, premiums, and liquidity challenges — make gold ETFs a more practical alternative for modern investors.
Although gold prices pulled back slightly today, it is possible that this is due to traders booking profits after the sharp ascent, and the movement is still bullish for the metal.
A walk down the memory lane shows us that gold has historically thrived during Trump’s presidency. When he assumed office in 2017, gold prices were near $1,200 per ounce, soaring to $1,957 per ounce by January 2021, as pointed out in a report in FXEmpire.
Now, in Trump's second term, the “Tariff Man” — a self-proclamation he made during his first term — is introducing aggressive policies, further stoking uncertainty.
His proposals to impose 25% tariffs on Mexico and Canada by Feb. 1 and to levy a 10% tariff on Chinese imports could impact global trade dynamics.
Just an example of why the markets are volatile, Canada is one of the world's largest producers of gold and a GSC Commodity Intelligence study revealed that the U.S. is the world’s largest importer of Canadian gold. A 25% tariff on imports from Canada might impact overall U.S. imports.
See Next:
Photo: Shutterstock
© 2025 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
