Menu
Skip to content 
Since the first ETF issues in Switzerland around 20 years ago, the ETF investment product has been a great success story. The high diversification coupled with low costs can be a great investment opportunity with good returns for many investors. In addition to the classic ETFs, which cover the SMI, for example, other so-called theme ETFs have emerged from the ETF success story in recent years. One of the most popular of these is the gold ETF. Gold as an investment has been known and successful for centuries, so why not also save it as a gold ETF?
If you have any more questions on the topic, we look forward to an exchange in the comments!
With theme ETFs, such as a gold ETF, a diversified investment in a specific investment theme is made possible. In principle, a theme ETF does not track a (benchmark) index or target a specific investment style such as dividend stocks. In the example of the gold ETF, it is the gold price development or different public companies from the gold production (e.g. gold mining companies).
Themes ETFs often pick up investment groups that cover current trend themes or themes with a potentially higher return. Clean energy, digitalisation and health are currently just as popular as traditional forms of investment such as precious metals and other commodities. It is precisely the hopes and fantasies of sharply rising prices in these absolute hypotheticals that make this type of investment look so attractive to many investors.
Here you can see the historical performance of gold in the ZKB Gold ETF mapped:
Before we continue with the gold ETF, we would like to briefly discuss gold as an investment. Gold can be invested in the very classical sense physically as a bar or coin. This has already been practiced for many hundreds of years. But why do people invest in a form of investment that usually yields poorer returns than equities? The answer seems quite simple at first glance: because it is safe. Gold has always had, has and will always have an equivalent value and will never lose its entire value. Gold is the safe haven in times of crisis. So says the common vernacular.
However, gold is also a form of investment that yields neither dividends nor interest and therefore only generates returns through price gains. Saving as with a gold ETF savings plan is not possible with physical gold. The gold price often rises sharply in times of crisis such as a global financial crisis. At the same time, however, the gold price is highly volatile. In 2011, for example, it was just under 1,900 euros US dollars per troy ounce, in 2013 the value fell to below 1,200 US dollars and in April of 2021 it stands at 1,700 US dollars. Gold thus fluctuates more than an investment in, for example, the MSCI World and provides only half the return in the long term. Furthermore, gold is traded in USD (currency risk) and has high storage and transaction costs.
Back to looking at themes ETFs. What makes them so appealing and what are the risks associated with buying them?
Opportunities:
Risks:
Your key to success! Discover our top recommendations from real testimonials.
Let's start with the obvious. Storing a gold bar is different than storing a gold ETF in your custody account. Buying a gold ETF makes investing in gold much easier and less expensive for the investor. Regular ETF saving with small amounts is also feasible. In addition, there is the possibility to invest via ETF in companies that are active in gold mining or production. Own theme ETFs in the field of gold ETFs thus. Note, however, that a gold ETF that reproduces the performance of gold-producing companies does not cover the gold price, but the price movements of the underlying companies - a big difference.
When looking at a gold ETF and the potential opportunities that an investment offers, one should be aware of the opportunities and risks. An investment in a gold ETF is particularly suitable in turbulent times and as a short-term speculation. Unsettled markets mean that many investors flee to the safe haven of gold and thus the price of gold rises sharply. Since an ETF is very easy to trade, it can be traded very flexibly and with the help of the very close buying and selling prices (spreads).
The cost of buying a gold ETF is significantly lower than that of a physical bar or coin, and there are no storage costs, except of course (existing) custody costs. Also note: a gold ETF is not taxed due to non-existent income, but gold in physical form is part of the taxable assets and is therefore listed in the tax return.
Gold can be considered a safe haven in times of crisis. A themed ETF can track the commodity cheaply and at the same time provide good liquidity. Only physical gold that has been acquired by cash payment, for example, is anonymous. If you want to hedge against the worst case scenario, physical gold is the only option. But those who want to buffer their equity portfolio with gold in the event of a crash can do so conveniently with an ETF. Providers like Selma Finance or True Wealth do it automatically for you!
What are you missing on the subject?
Leave us a comment there!
Your key to success! Discover our top recommendations from real testimonials.