Attention gold aficionados: Reuters just gave some press to two gold ETFs -- and columnist John Wasik discovered surprising differences between funds whose basic purpose is to buy and hold bullion.

Wasik looks first at the "big gorilla" of gold ETFs, the $74-billion SPDR Trust Gold fund [profile]. He thinks it's a bit expensive — it charges 40 basis points, which goes toward storing its 1.3 metric tons of gold in the HSBC bank vault in London — but it offers liquidity, and so he thinks it's a good choice for those who trade frequently.

For the more cost-conscious gold investor, Wasik recommends the $11-billion iShares Gold Trust [profile]. The expense ratio — 25 bps — is lower than the SPDR fund's, and it has delivered a 6.6 percent return so far this year.

Wasik's conclusion will bring no joy to State Street management: "In this basic cost analysis, the iShares fund comes out ahead for buy-and-holders."

Full story here. 

Edited by: Chris Cumming


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