Generated August 15, 2026.
Overview
GLD and IAUM are both physically backed gold ETFs designed to track the spot price of gold bullion, but they differ sharply in scale and cost structure. GLD is the market's largest gold ETF at $132B in assets, while IAUM (launched in 2021) is a newer, micro-sized alternative with $7.47B in AUM. The critical distinction is expense ratio: IAUM charges 0.09% annually versus GLD's 0.40%, a fourfold cost advantage that compounds meaningfully over time for buy-and-hold holders.
How they differ
Both track the same underlying asset—physical gold—and carry identical beta exposure (0.36 against the broader market), so the primary difference is fees. IAUM's 0.09% expense ratio costs roughly $9 per $10,000 invested annually, while GLD's 0.40% costs roughly $40 per $10,000, creating a 31 basis point annual drag that accumulates into significant performance divergence over decades. GLD's $132B in AUM dwarfs IAUM's $7.47B, which translates to tighter spreads and higher trading volume on GLD but also suggests GLD has already captured the bulk of passive gold-tracking demand. Neither fund distributes income, so there's no yield consideration—both are appreciation-only vehicles. The price points differ ($401.48 for GLD versus $43.63 for IAUM), but that's a share-size convention; what matters is the net return after fees.
Who each is best for
GLD: Investors who prioritize maximum liquidity and the deepest order book—important for very large positions or frequent rebalancing—and are willing to accept a higher fee for the security of holding the market's oldest and largest gold ETF.
IAUM: Fits investors with a long time horizon and modest-to-moderate position sizes who value cost efficiency and are comfortable with IAUM's newer track record and smaller asset base in exchange for materially lower annual expenses.
Key risks to know
- Fee drag on long holding periods. The 31 basis point annual expense difference between GLD and IAUM, while appearing small, compounds into 3.1 percentage points of foregone returns over a 10-year period assuming flat gold prices. Over 20 years, the gap widens further.
- Storage and insurance costs embedded in expense ratios. Both funds hold physical gold in bank vaults and carry insurance; these costs are built into the expense ratio and will rise if gold volatility or geopolitical conditions increase insurance premiums, raising the drag on both funds proportionally.
- Liquidity divergence. GLD's $132B in AUM ensures that large trades will execute with minimal slippage, while IAUM's $7.47B base may experience wider bid-ask spreads during volatile markets or in smaller or less-liquid hours.
- No income offset. Neither fund distributes dividends or interest, so investors capture returns solely through gold-price appreciation; holders cannot reinvest cash flow and are fully exposed to timing risk if they need to rebalance during a downturn.
Bottom line
If you prioritize trading ease and the peace of mind of holding the industry standard, GLD's liquidity and 20-year track record justify the higher cost. If you're building a core long-term gold position and want to minimize fee drag, IAUM's 31 basis point advantage compounds meaningfully—but verify that IAUM's smaller size and younger inception date suit your holding period and risk tolerance. Past performance of gold does not predict future returns.
AI-generated analysis for educational purposes only. Verify important details independently; past performance does not guarantee future results.
