The VanEck Gold Miners AUD ETF (ASX: GDX) closed at $77.64 on Tuesday, down 0.72%.
Over the past year, the global gold price has continually reset its record high.
This has happened because investors have sought a safe-haven asset amid geopolitical tensions, economic challenges including higher inflation and interest rates, and US tariff turmoil.
On Tuesday, the gold price was trading at US$3,325 per ounce, up 42% over the past year.
Many ASX gold shares have hit record-high prices over the past 12 months.
If you weren't confident about choosing individual stocks and tried ASX gold ETFs instead, how has that worked out?
Have exchange-traded funds (ETFs) proven to be a good way to leverage the gold price bonanza?
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Has the GDX ETF delivered for investors?
The VanEck Gold Miners AUD ETF gives investors exposure to a diversified global portfolio of gold mining companies.
VanEck says the ASX GDX is the largest gold miners ETF in the world with its total net assets worth $770.91 million.
The GDX ETF seeks to mirror the performance of the NYSE Arca Gold Miners Index (AUD) before fees.
About 37% of the ETF's funds are in Canadian gold miners, 16% are in US gold miners, and 11% are in South African miners.
The ASX ETF pays distributions, or dividends, once per annum.
The management fee is 0.53% per annum.
Say you invested $10,000 a year ago…
On 27 May last year, the GDX ETF closed at $54.32 apiece.
If you had put $10,000 into GDX then, it would have bought you 184 units (for $9,994.88).
There's been a whopping capital gain of $23.32 per unit since then.
That has delivered Australian investors very handsome capital growth of $4,290.88 in just one year.
Therefore, your portfolio is now worth $14,285.76.
In terms of dividends (called 'distributions' with ETFs), GDX paid 74 cents per unit on 23 July last year.
That means you've received $136.16 in annual income.
Total returns…
Your phenomenal capital gain of $4,290.88 plus $136.16 in dividends gives you a total dollar return of $4,427.04 over the past 12 months.
Now remember, you invested $9,994.88 buying your 184 units on 27 May last year.
This means you have received a total return, in percentage terms, of 44.29%.
That is vastly higher than this ASX gold ETF's long-term average.
Since its inception on 26 June 2015, the GDX ETF has delivered an average annual return of 13.74%.
