Gold has long been a symbol of wealth and security. If you’re looking for protection against inflation or a buffer during market volatility, SPDR Gold Shares (GLD) offers a simple and trusted path to gold exposure.
📌 1. Basic Information
- ETF Name: SPDR Gold Shares (GLD)
- Issuer: State Street Global Advisors
- Inception Date: November 18, 2004
- Underlying Index: LBMA PM Gold Price
- Expense Ratio: 0.40%
- Dividend Yield: None
- Distribution Frequency: Not applicable
- Current Price (as of May 2025): ~$190
- Average Daily Volume: Over 6 million shares
🧐 What is the LBMA PM Gold Price?
The London Bullion Market Association (LBMA) sets the global benchmark price of gold twice daily through an auction-style system among major global banks.
It’s considered a trusted and transparent indicator for gold prices worldwide.
✅ 2. Advantages of GLD
- Direct exposure to physical gold
- Highly liquid and widely traded
- No need to worry about storing or insuring physical gold
- Acts as a hedge in times of crisis or inflation
- Gold bars are securely stored and audited in London (HSBC vault)
⚠️ 3. Disadvantages
- No dividend or yield
- Higher expense ratio (0.40%) compared to alternatives like IAU (0.25%) or GLDM (0.10%)
- No physical redemption for retail investors
- In the U.S., taxed as a “collectible” with a potential capital gains rate of up to 28% (Note: This generally doesn’t apply to non-U.S. residents)
📈 4. Historical Performance
- 1-Year Return (2024–2025): +21.3%
- 5-Year CAGR: ~8.5%
- 10-Year CAGR: ~4.2%
Gold has consistently proven its strength during uncertain times — such as the 2008 financial crisis, the 2020 pandemic, and most recently, global tensions and inflation in 2024–2025.
📉 5. Dividend Growth — There Isn’t Any
GLD pays no dividends because gold doesn’t produce income.
Still, many investors include it for:
- Wealth preservation
- Portfolio diversification
- Performance during market downturns
6. Structure and Holdings
- GLD holds 100% physical gold bars
- Stored in HSBC vaults in London
- Ownership is fractional through a trust
- As of May 2025, GLD holds over 900 metric tons of gold
🔄 7. Rebalancing
GLD doesn’t rebalance like a stock ETF. Instead:
- Shares are created or redeemed based on demand
- This mechanism keeps GLD’s price closely aligned with actual gold value
Example: During COVID-19 in 2020 and the geopolitical tensions of 2023, GLD saw major inflows and increased its gold holdings significantly.
🔥 8. Why Is Gold Booming Right Now? (2024–2025)
Key Reasons:
- Central bank buying (de-dollarization strategy)
- Geopolitical instability
- Negative or low real interest rates
- Weakening U.S. dollar
- Rising demand from retail and ETF investors
🌍 Who’s Buying All This Gold?
| Buyer Type | Reason |
|---|---|
| Central Banks | Reserve diversification, reduce USD reliance |
| Institutional Funds | Hedge portfolios, preserve capital |
| Retail Investors | Crisis hedge, inflation worries |
| Sovereign Wealth | Long-term value store |
| Asian Demand | Cultural + strategic (China, India, etc.) |
🤔 Final Thoughts (Including My Perspective)
GLD may not offer the excitement of tech stocks or the income of dividend ETFs.
But it provides something just as important — stability in chaos.
Here’s my honest take:
I used to invest 100% in stocks because historical data showed that was the best path to long-term growth.
But recently, I’ve noticed a shift. Gold’s performance has been stronger than stocks in the short term,
and the global demand signals a trend reversal that I can’t ignore.
So while I won’t abandon stocks, I’ve decided to allocate around 5% of my portfolio to gold.
It’s a small change, but one I believe can make a big difference when markets shake.
📝 Disclaimer & Final Notes
Just to be clear — I’m not a financial advisor.
I’m simply sharing my personal investing journey here.
Please do what feels right for you. 🙂
Thanks for reading — and as always, invest smart and stay consistent.
See you in the next post! 🚀
Step by step — that’s how we build something lasting.
🔗 Sharing is welcome — but please credit the source (investorJB.com) when you do.