Investors looking to weather volatile markets may choose physical gold over gold stocks.
That’s according to George Milling-Stanley, one of the world’s gold experts and chief gold strategist at State Street Global Advisors.
“One of the reasons I own gold bullion is I believe it provides me with some protection against potential weakness in the stock market,” Millin-Stanley told CNBC’s “ETF Edge” this week. “When stocks go down. , gold mining stocks Remember, they are stocks and tend to fall with the overall level of the stock market. So, they offer me no additional protection. “
Millin-Stanley’s firm operates two exchange-traded funds that track the performance of gold’s spot price: SPDR Gold Stock ETF (GLD) and SPDR Gold Mini Cap Trust (GLDM).
What sets them apart, Milling-Stanley said, is their total expense ratio (0.40% for GLD and 0.10% for GLDM), and it’s this key distinction that also differentiates the type of investors they attract.
“If you’re someone who wants to trade… or if you want to be a tactical player – which means you need to be able to move very, very quickly – then GLD’s liquidity 20 years later now means it has Very, very fast liquidity. Lower transaction costs than any other gold ETF,” he said. “If you have $1 million and you want to put $1 million into gold and leave it there, then GLDM with a lower expense ratio makes more sense for you.”
As of Thursday’s close, GLD and GLDM were both up 15% year-to-date.
Gold Bullion, Bitcoin, and Baby Boomers
The idea is gold Milling-Stanley said this “old school” investing no longer rings true.State Street 2023 Gold ETF Impact Study Millennials were found to have a higher proportion of gold in their portfolios than older generations.
As Bitcoin continues to attract assets from Millennials and Generation Z, the metal is gaining popularity among younger investors. policy genius Surveys released this week found that Millennials are more likely to own Bitcoin than other generations, while Gen Z is more likely to own Bitcoin than stocks, bonds or real estate.
But Millin-Stanley refutes gold and Bitcoin There is an all-out scramble for assets.
“Bitcoin is probably going to be competition for people who want to take a tactical position in gold and wait for the price to go up and sell. I think Bitcoin is probably going to provide competition there,” he said. “But I don’t think Bitcoin is really competitive in terms of long-term strategic allocation, and that’s where I think gold really comes into play.”
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