IShares Gold Trust (IAU), GLD, GDX ETFs Outflows Are Accelerating

Investors are dumping their gold assets as prices continue plunging. The closely watched iShares Gold Trust (IAU) and SPDR Gold Trust (GLD) ETFs have now had outflows in the past four straight months and the situation is getting worse.


IAU, GLD, GDX outflows continue

Data compiled by shows that the iShares Gold Trust, which has over $24.7 billion in assets, lost over $1.1 billion in September after losing $875 million in August and $271 million in July. In all, the fund has shed over $2.1 billion this year. Notably, it has lost funds in five of the last nine months.

Investors are dumping gold ETFs because of the falling prices. Gold price has plunged to $,1847, the lowest level since March 10th. It has dropped by more than 11.37% from the highest point this year, meaning it has moved into a correction.

(Click on image to enlarge)

Gold price


US dollar index surge continues

Gold’s sell-off has come at a time when the US dollar index (DXY) has jumped to a multi-month high of $106.7. The greenback has risen by over 6% from the lowest level this year. Its comeback continued after the strong US inflation data followed by the hawkish Federal Reserve.

The same is true with the SPDR Gold Trust Trust, the biggest gold-focused ETF, with over $52.2 billion in assets. Like the IAU ETF, the fund shed over $998 million in September after losing $1.4 billion in August. It has lost more than $2.4 billion this year. 

Gold miner ETFs have also seen substantial outflows in the past few months. The closely watched VanEck Gold Miner ETF (GDX) also lost more than $327 million in September, It has lost over $664 million this year.

In its September meeting, the Fed decided to leave rates unchanged between 5.25% and 5.50%. It also pointed to another 0.25% rate hike in the coming meeting, which will push them to the highest point in decades.

The IAU, GLD, and GDX ETFs also saw outflows as stocks and bonds continued falling. The key long-term bond ETFs like TLT, VGLX, and BND stocks plunged to the lowest point in years. Similarly, key indices like the Russell 2000, Dow Jones, and the Nasdaq 100 indices have dropped sharply in the past few months. 

The IWM ETF, which tracks the small-cap Russell 2,000 index has dropped by over 12% from the YTD high as many companies struggle in a high-risk environment. 

Therefore, gold’s performance has raised questions about its role as a safe haven and a hedge against inflation.

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