The ASX offers a range of attractive options to invest in gold.
We'll take a look at some top possibilities below.
But first, why invest in gold at all?
And why not simply buy physical bullion?
What's happening with the gold price?
The first reason to invest in gold is that the yellow metal has been on a historic bull run, racing higher at a pace not witnessed since 1986.
This morning, the gold price set yet another new all-time high of US$3,255.90 per ounce (AU$5,215/oz). That's up almost 37% since this time last year when that same ounce was fetching US$2,383.
Among other factors, gold has benefited from ongoing strong demand from central banks, falling interest rates (gold pays no yield itself and tends to perform better in low or falling rate environments), and its classic haven status amid rising geopolitical uncertainty.
And with these factors ongoing, many analysts believe the gold price will continue to rise from here.
As for the second question, there's certainly something almost magical about buying and holding physical gold. Whether that's a 400-ounce standard gold bar or a one-ounce gold coin, the yellow metal has drawn human interest for more than 5,000 years.
But before you run off and invest in gold bullion, give a thought to how you'll keep that secure over the long term.
Options include bank storage vaults, which will charge you significant fees. Or you could invest in a high end safe yourself, but the truth is any safe can be cracked by the right (or wrong) people. Or you could grab a shovel and get to work on sketching out that treasure map.
Which brings us back to our headline question…
How to invest in gold on the ASX
There are three predominant ways you can invest in gold on the ASX.
The first two involve buying ASX exchange-traded funds (ETFs).
If you're looking to get a similar performance to movements in the gold price, there are a number of ASX ETFs that are aimed at tracking the daily moves of bullion.
One option to consider is the ETFS Metal Securities Australia Limited (ASX: GOLD), which is meant to track the price movements in physical gold in Aussie dollars.
The ASX ETF is up 22.2% year to date.
Another option is to invest in gold on the ASX via an ETF that holds a basket of gold miners. This offers some instant diversity and provides leverage to movements in the gold price, as gold stocks tend to see bigger moves (both up and down) than any moves in the gold price.
One option here is the VanEck Vectors Gold Miners ETF (ASX: GDX).
"I remain bullish on the gold price and this exchange traded fund is an effective way to capture future upside," said Fairmont Equities' Michael Gable, who has a buy recommendation on this ASX ETF (courtesy of The Bull).
According to Gable:
Purchasing an ETF containing a range of gold mining companies reduces and spreads risk compared to investing in a single gold mining exposure.
An ETF offers leverage to gold's upside, and we expect gold stocks to move higher than the underlying gold price from here. I'm expecting the gold price to hit levels around US$4,000 an ounce during 2025.
Do your research and invest in gold via the ASX miners
The third way you can invest in gold via the ASX is by buying individual ASX gold stocks.
This will take a bit more time and effort, as you should always do your research before investing in any new stocks. And don't hesitate to reach out for professional advice.
But with the gold price soaring, here are some top S&P/ASX 200 Index (ASX: XJO) gold miners to investigate:
- Northern Star Resources Ltd (ASX: NST)
- Newmont Corp (ASX: NEM)
- Ramelius Resources Ltd(ASX: RMS)
- Gold Road Resources Ltd (ASX: GOR)
- Evolution Mining Ltd (ASX: EVN)
- Perseus Mining Ltd (ASX: PRU)
- De Grey Mining Ltd (ASX: DEG)
- Bellevue Gold Ltd (ASX: BGL)
- West African Resources Ltd (ASX: WAF)
Here's to prosperous gold investing on the ASX!
