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6 gold funds to consider for exposure to the yellow metal
Gold funds can be one of the best ways of adding gold to your portfolio. We highlight some of the more interesting funds for gold spot prices and gold miners.
The gold rally of 2024 and 2025 levelled off in 2026, but gold remains a key strategic asset to hold in your portfolio. Gold funds can be one of the most accessible ways to gain this exposure.
At a basic level there are four ways to invest in gold: you can buy physical gold in the form of gold coins or gold bars and store them either at home or through a specialist custodian; you can buy an instrument that tracks physical gold prices – an exchange-traded commodity (ETC), which acts similarly to an exchange-traded fund but only tracks the price of one specific commodity; you can buy shares in individual gold miners as you would with any other stock; or you can buy a gold fund that is a selection of stocks like these.
All have their advantages and disadvantages, but there’s an argument that, depending on your circumstances and what you’re hoping to gain by holding gold, funds could offer the best balance of advantages.
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Compared to either physical gold or gold ETCs, individual gold stocks tend to be more volatile: they rise higher when gold prices rise, but fall further when it drops.
“Mining stocks offer you an operational leverage to the gold price,” Cosmo Sturge, director of market strategy at metals fund manager Baker Steel, told MoneyWeek.
They also – unlike either form of physical gold, can pay income to investors. The downside is that unlike physical gold, an individual gold mining company can be derailed by factors that have nothing to do with global gold prices – such as bad management or a legal dispute.
A gold mining fund mitigates this individual company risk by spreading your investment across multiple companies, but can still pay income and, often, still gives the extra volatility that investors look for when gold does well (with the obvious caveat that the opposite is also true when gold prices fall).
Gold mining funds
Gold mining funds offer a form of gold exposure, but remember that this is a distinct investment from physical gold or gold ETCs. Their performance can deviate from that of the price of physical gold.
The Superpit is Australia's largest open pit gold mine, and one of the largest open pit mines in the world
(Image credit: samvaltenbergs via Getty Images)
Some specialised gold mining funds include:
The VanECk Gold Miners UCITS ETF (LON:GDGB), a passive ETF which tracks the NYSE Arca Gold Miners Index;
The AuAg ESG Gold Mining UCITS ETF (LON:ESGP), an equal-weighted ETF tracking ESG-screened companies that are active in the gold mining industry;
The L&G Gold Mining UCITS ETF (LON:AUCP) which tracks the Global Gold Miners Index;
The WS Ruffer Gold Fund; an actively-managed fund with a strong track record of outperforming its benchmark.
Gold funds with broader exposure
There’s lots to be said for having pure gold exposure in your portfolio, but there are funds that combine gold exposure with other metals.
The Baker Steel Gold & Precious Metals Fund invests in diversified gold and precious metals equities, with a focus on picking value stocks in the sector. As of 31 May, its portfolio was weighted 66% towards companies that primarily mine gold, 20% towards silver miners, 9% towards platinum group metals and 5% in cash.
Alternatively, investors could consider a gold-focused investment trust, such as Golden Prospect Precious Metals (LON:GPM). This investment trust invests in small-mid cap (c. £200 million to £2 billion in value) mining stocks globally. In terms of the primary metals produced by its portfolio mines, the portfolio is weighted 78.4% towards gold and 20.6% towards silver (with the remainder accounted for by platinum group metals and base metals).
The investment trust wrapper makes an excellent vehicle for investing in relatively early-stage mining outfits: “sticky money in general is well-suited to this type of longer-term sector,” Keith Watson, one of the trust’s portfolio managers, told MoneyWeek.
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Dan is a financial journalist who, prior to joining MoneyWeek, spent five years writing for OPTO, an investment magazine focused on growth and technology stocks, ETFs and thematic investing.
Before becoming a writer, Dan spent six years working in talent acquisition in the tech sector, including for credit scoring start-up ClearScore where he first developed an interest in personal finance.
Dan studied Social Anthropology and Management at Sidney Sussex College and the Judge Business School, Cambridge University. Outside finance, he also enjoys travel writing, and has edited two published travel books.
